DEFENDANT’S REPLY MEMORANDUM IN SUPPORT OF ITS …1. Rasul v. Bush Has No Bearing on Plaintiffs’ International Law Cause of Action ..... 63 2. Sosa v. Alvarez-Machain Confirms

UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF FLORIDA

Case No. 01-1859-CIVSEITZ

IRVING ROSNER, et al., ))

Plaintiffs, ))

v. ))

UNITED STATES OF AMERICA, ))

Defendant. ))

DEFENDANT’S REPLY MEMORANDUM IN SUPPORT OF ITS MOTION TODISMISS PLAINTIFFS’ FIRST AMENDED COMPLAINT

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TABLE OF CONTENTS

PAGE

INTRODUCTION .......................................................................................................................... 1

ISSUES OF FACT ......................................................................................................................... 2

I. Facts Necessary to Determination of Subject Matter Jurisdiction ..................................... 2

A. Whether Property Belonging to Plaintiffs Came into the United States’ Possession (For Standing Determination) ...................................... 2

B. Whether Any Conduct by the United States Led Plaintiffs to Miss the Applicable Filing Deadline (For Statute of Limitations) .................... 3

C. When Plaintiffs Reasonably Could Have Exercised Due Diligence to Learn about the Gold Train (For Statute of Limitations) .................. 5

II. Additional Facts Relevant to Background and Merits of Plaintiffs’ Claims ..................... 6

A. Whether the Gold Train Property That Came into U.S. Possession Was Identifiable as to Individual Ownership ......................................................... 6

B. Whether Gold Train Property that Came into U.S. Possession was Identifiable as to National Origin ........................................................................... 8

C. Whether the United States Promised Officials of the Axis Hungarian Government That it Would Safeguard Gold Train Property until it Could Be Returned to the Jews from Whom it Was Confiscated ........................ 10

D. The United States’ Efforts to Safeguard the Gold Train Property ....................... 11

E. Scope of and Authority for the Requisitioning of Property from the Gold Train ...................................................................................................... 12

F. Why the United States Decided to Turn over Gold Train Property to the IGCR .......................................................................................................... 13

ARGUMENT ............................................................................................................................... 15

I. Plaintiffs Fail to Establish Subject Matter Jurisdiction ................................................... 15

A. Factual Determination for Fed. R. Civ. 12(b)(1) ................................................. 16

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B. Each Plaintiff Must Establish Standing ............................................................... 16

1. None of the Plaintiffs Has Constitutional Standing ................................. 17

a. Because the Government Presents a Factual Challenge to Standing, Plaintiffs Cannot Rely on Mere Allegations ............ 18

b. Plaintiffs Cannot Prove That Their Property Was on Gold Train When the Army Took Control of the Train ............... 19

c. The United States Was under No Deadline to Decide the Property’s Disposition ............................................................ 25

d. Plaintiffs from the Annexed Territories Would Not HaveBenefitted from a Restitution to Hungary .................................... 27

e. Plaintiffs’ Burden of Establishing Standing is not Lessened Due to the Passage of Time .......................................... 27

f. Plaintiffs Establish No Basis for Application of Spoliation Principles .................................................................... 28

2. Plaintiffs Do Not Satisfy the Criteria for Exception to the General Prohibition Against Third-Party Standing .................................. 31

C. Equitable Principles Do Not Warrant PermittingPlaintiffs’ Otherwise Time-Barred Claims to Proceed ........................................ 34

1. Compliance with Applicable Statute of Limitations is a Condition of this Court’s Jurisdiction ...................................................... 34

2. Neither the Equitable Tolling Doctrine nor the Accrual Suspension Rule Justifies Plaintiffs’ Late Filing ..................................... 37

a. Equitable Tolling ......................................................................... 37

b. Suspension of Accrual Date ......................................................... 44

D. The APA Does Not Permit Review for the Claims Plaintiffs Assert under It ...................................................................................................... 46

E. The Little Tucker Act Does Not Provide A Waiver of Sovereign Immunity for Plaintiffs’ International Law Claims .............................................. 50

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II. The First Amended Complaint Fails To State a Claim upon which Relief May Be Granted ............................................................................................................... 51

A. Rule 12(g) Does Not Protect Plaintiffs from Judicial Review of the First Amended Complaint .................................................................................... 51

B. Plaintiffs’ Claims Are Barred by International Agreements ................................ 54

1. The Treaty of Peace Bars Plaintiffs’ Claims ............................................ 55

2. The 1973 Settlement Agreement Bars Plaintiffs’ Claims ........................ 59

C. This Court Properly Dismissed Plaintiffs’ Takings Claim with Prejudice .......... 60

D. The Claim for Breach of Implied-In-Fact Contract Cannot Succeed ................... 63

E. Plaintiffs’ International Law Count Fails To State a Claim ................................. 63

1. Rasul v. Bush Has No Bearing on Plaintiffs’ International Law Cause of Action ................................................................................ 63

2. Sosa v. Alvarez-Machain Confirms that Plaintiffs’ International Law Count Fails To State a Claim upon which Relief May Be Granted ..................................................................................................... 64

F. Plaintiffs’ Illegal Exaction Count Fails To State a Claim .................................... 66

G. Plaintiffs’ Count for Violation of Executive Regulations or Military Rules Fails To State a Claim ................................................................................ 68

CONCLUSION ............................................................................................................................ 70

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TABLE OF AUTHORITIES

CASES PAGE(S)

Adkins v. United States, 68 F.3d 1317 (Fed. Cir. 1995) ............................................................. 70

Aleutco Corp. v. United States, 244 F.2d 674 (3d Cir. 1957) .................................................... 44

Allen v. Wright, 468 U.S. 737 (1984) ................................................................................... 32, 33

Amato v. Wilentz, 952 F.2d 742 (3d Cir. 1991) ......................................................................... 34

American Immigration Lawyers Ass'n v. Reno, 199 F.3d 1352 (D.C. Cir. 2000) ...................... 33

American Iron & Steel Inst. v. OSHA, 182 F.3d 1261 (11th Cir. 1999) .............................. 17, 18

Argentine Republic v. Amerada Hess, 488 U.S. 428 (1989) ...................................................... 65

Banco Nacional de Cuba v. Chase Manhattan Bank, 658 F.2d 875 (2d Cir. 1981) .................... 66

Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (1964) ..................................................... 66

Bashir v. Amtrak, 119 F.3d 929 (11th Cir.1997) .................................................................. 28, 32

Bath Iron Works Corp. v. United States, 20 F.3d 1567 (Fed. Cir. 1994) ................................... 36

Bennet v. Spear, 520 U.S. 154 (1997) ........................................................................................ 19

Bieregu v. Ashcroft, 259 F. Supp. 2d 342 (D.N.J. 2003) ............................................................ 65

Bischoff v. Osceola Cty., 222 F.3d 874 (11th Cir. 2000) ..................................................... 18, 19

Blickenstaff v. R.R. Donnelley & Sons Co. Short Term Disability Plan, __ F.3d __, 2004 WL 1770467 (7th Cir. Aug. 9, 2004) ...................................................... 61

Bluth v. Laird, 435 F.2d 1065 (4th Cir. 1970) ............................................................................ 70

Bodner v. Banque Paribas, 114 F. Supp. 2d 117 (E.D.N.Y. 2000) ............................................. 38

Bolchos v. Darrel, 3 F. Cas. 810 (D.S.C. 1795) .......................................................................... 67

Bost v. Federal Express Corp., 372 F.3d 1233 (11th Cir. 2004) ..................................... 41, 43, 46

Brown v. E.F. Hutton & Co., 610 F. Supp. 76 (S.D. Fla. 1985) ........................................... 53, 54

Burnett v. New York Cent. R.R., 380 U.S. 424 (1965) ........................................................ 44, 47

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Estate of Cabello v. Fernandez-Larios, 157 F. Supp. 2d 1345 (S.D. Fla. 2001) ......................... 17

Cada v. Baxter Healthcare, 920 F.3d 446 (7th Cir. 1990) .................................................... 43, 44

Chan v. Korean Air Lines, Ltd., 490 U.S. 122 (1989) .......................................................... 54, 55

Chrysler Corp. v. Brown, 441 U.S. 281 (1979) .......................................................................... 69

Chung v. Department of Justice, 333 F.3d 273 (D.C. Cir. 2003) ............................................... 44

Cobell v. Norton, 240 F.3d 1081 (D.C. Cir. 2001) ..................................................................... 50

Compagnoni v. United States, 173 F.3d 1369 (11th Cir. 1999) ................................................. 35

Cuban Am. Bar Ass'n, Inc. v. Christopher, 43 F.2d 1412 (11th Cir. 1995) ................................ 62

Deutsch v. Turner Corp., 324 F.3d 692 (9th Cir. 2003) .............................................................. 42

Disconto Gessellschaft v. Umbreit, 208 U.S. 570 (1908) ........................................................... 63

Dreyfus v. Von Finck, 534 F.2d 24 (2d Cir. 1976) ..................................................................... 70

Eastport S.S. Corp. v. United States, 372 F.2d 1002 (Fed Cir. 1967) ........................................ 67

El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng, 525 U.S. 155 (1999) ......................................... 55

Estate of Cabello v. Fernandez-Larios, 157 F. Supp.2d 1345 (S.D. Fla. 2001) ........................... 17

Feliciano v. Laird, 426 F.2d 424 (2d Cir. 1970) ......................................................................... 70

Ferreiro v. United States, No. 96-4963 (11th Cir. Sept. 30, 1997) ............................................. 44

First Alabama Bank N.A. v. United States, 981 F.2d 1226 (11th Cir. 1993) ....................... 40, 41

Franconia Assoc. v. United States, 536 U.S. 129 (2002) ...................................................... 35, 37

Frazer v. United States, 288 F.3d 1347 (Fed. Cir. 2002) ............................................................ 40

Furnes v. Reeves, 362 F.3d 702 (11th Cir. 2004) ....................................................................... 44

Gammill v. United States, 727 F.2d 950 (10th Cir. 1984) .......................................................... 70

Garcia v. Copenhaver, Bell & Assoc., 104 F.3d 1256 (11th Cir. 1997) ..................................... 17

Haitian Refugee Ctr. v. Baker, 953 F.2d 1498 (11th Cir. 1992) ................................................. 66

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Harris v. Evans, 20 F.3d 1118 (11th Cir. 1994) .......................................................................... 33

Hazardous Waste Treatment Council v. Thomas, 885 F.2d 918 (D.C. Cir. 1989) ..................... 32

Herrera v. United States, 222 U.S. 558 (1912) ........................................................................... 58

Hijo v. United States, 194 U.S. 315 (1904) ................................................................................ 57

Hopland Band of Pomo Indians v. United States, 855 F.2d 1573 (Fed. Cir. 1988) .................... 40

Irwin v. Department of Veterans Affairs, 498 U.S. 89 (1990) ............................................. passim

Iwanowa v. Ford Motor Co., 67 F. Supp. 2d 424 (D.N.J. 1999) ................................................ 42

Japanese War Notes Claimants Assoc. v. United States, 373 F.2d 356 (Ct. Cl. 1967) ........ 45, 46

Jifry v. FAA, 370 F.3d 1174 (D.C. Cir. 2004) ............................................................................ 62

Johnson v. Bd. of Regents of the Univ. of Georgia, 263 F.3d 1234 (11th Cir. 2001) ................ 17

Johnson v. Eisentrager, 339 U.S. 763 (1950) ....................................................................... 62, 63

Justice v. United States, 6 F.3d 1474 (11th Cir. 1993) ......................................................... 37, 38

Kadic v. Karadzic, 70 F.3d 232 (2d Cir. 1995) ........................................................................... 65

Kalamazoo Spice Extraction Co. v. Provisional Military Gov't of Socialist Ethiopia, 729 F.2d 422 (6th Cir. 1984) ................................................................................................ 66

Kontrick v. Ryan, 124 U.S. 906 (2004) ................................................................................ 35, 37

Kwan v. United States, 272 F.2d 1360 (Fed. Cir. 2001) ....................................................... 55, 56

Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) ................................................................ 19

Macleod v. United States, 229 U.S. 416 (1913) ......................................................................... 49

Madsen v. Kinsella, 343 U.S. 341 (1952) ................................................................................... 49

Martinez v. United States, 333 F.3d 1295 (Fed. Cir. 2003) .................................................. 35, 45

Midrash Sephardi, Inc. v. Town of Surfside, 366 F.3d 1214 (11th Cir. 2004) ..................... 18, 19

Morrison v. Amway Corp., 323 F.3d 920 (11th Cir. 2003) .................................................. 16, 17

Morrison v. United States, 492 F.2d 1219 (Ct. Cl. 1974) ..................................................... 47, 69

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Mount v. LaSalle Bank Lake View, 926 F. Supp. 759 (N.D. Ill. 1996) ..................................... 53

Murphy v. United States, 993 F.2d 871 (Fed. Cir. 1993) ........................................................... 70

Neri v. United States, 102 F. Supp. 718 (S.D.N.Y. 1951) .......................................................... 58

Neri v. United States, 204 F.2d 867 (2d Cir. 1953) .................................................................... 57

Nixon v. Secretary of the Navy, 422 F.2d 934 (2d Cir. 1970) .................................................... 70

Omaha Indian Tribe v. Jackson, 854 F.2d 1089 (8th Cir. 1988) ................................................ 28

Orient Overseas Container Line (UK) Ltd. v. United States, 48 Fed. Cl. 284 (2000) .................................................................................................................................... 67

Pauly v. United States, 152 Ct. Cl. 838 (1961) ........................................................................... 57

Phaidin v. United States, 28 Fed. Cl. 231 (1993) ....................................................................... 51

Phelps v. Hamilton, 122 F.3d 1309 (10th Cir. 1997) .................................................................. 17

Planned Parenthood of the Atlanta Area, Inc. v. Miller, 934 F.2d 1462 (11th Cir.1991) ...................................................................................................................... 18

Powers v. Ohio, 499 U.S. 400 (1974) ................................................................................... 33, 34

Prado-Steinman v. Bush, 221 F.3d 1266 (11th Cir. 2000) ......................................................... 18

Rasul v. Bush, 124 S. Ct. 2686 (2004) .................................................................................. 62, 63

Raziano v. United States, 999 F.2d 1539 (11th Cir. 1993) ................................................... 39, 41

Republica v. De Longchamps, 1 U.S. 111 (1784) ...................................................................... 67

Rosner v. United States, 231 F. Supp. 2d 1202 (S.D. Fla. 2002) ........................................ passim

Rosner v. United States, No. 01-1859-CIV, 2002 WL 3195442 (S.D. Fla. Nov. 25, 2002) ................................................................................................................ 60, 61

S.N.T. Fratelli Gondrand v. United States, 166 Ct. Cl. 473 (1964) ............................................ 56

Sampson v. Federal Republic of Germany, 975 F. Supp. 1108 (N.D. Ill. 1997), aff'd, 250 F.3d 1145 (7th Cir. 2001) ..................................................................................... 42

Sandvik v. United States, 177 F.3d 1269 (11th Cir. 1999) ................................................... 38, 41

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Scarborough v. Principi, 124 S. Ct. 1856 (2002) .................................................................. 35, 37

Schatten v. United States, 419 F.2d 187 (6th Cir. 1969) ............................................................ 70

Schiessle v. Stephens, 525 F. Supp. 763 (N.D. Ill. 1981) ........................................................... 52

Schweiker v. Hansen, 450 U.S. 785 (1981) ................................................................................ 69

Shanghai Power Co. v. United States, 4 Cl. Ct. 237 (1983) ....................................................... 67

Smith v. Resor, 406 F.2d 141 (2d Cir. 1969) .............................................................................. 70

Sosa v. Alvarez-Machain, 124 S. Ct. 2739 (2004) .............................................................. passim

The Rapid, 12 U.S. (8 Cranch) 155 (1814) ................................................................................. 58

Tiffany v. United States, 931 F.2d 271 (4th Cir. 1991) .............................................................. 70

Ungaro-Benages v. Dresdner Bank AG, __ F.3d __, 2004 WL 1725591 (11th Cir. Aug. 3, 2004) ........................................................................................................ 65

United States v. Alvarez-Machain, 504 U.S. 655 (1992) ........................................................... 55

United States v. Certain Land Situated in City of Detroit, 361 F.3d 305 (6th Cir. 2004) ....................................................................................................................... 18

United States v. Cotton, 535 U.S. 625 (2000) ...................................................................... 35, 37

United States v. Duarte-Acero, 208 F.3d 1282 (11th Cir. 2000) .......................................... 55, 57

United States v. Lombera-Camorlinga, 206 F.3d 882 (9th Cir. 2000) ........................................ 55

United States v. Pac. R.R. Co., 120 U.S. 227 (1887) .................................................................. 58

United States v. Rodriguez-Aguirre, 264 F.3d 1195 (10th Cir. 2001) ........................................ 23

United States v. Verdugo-Urquidez, 494 U.S. 259 (1990) ......................................................... 63

United States v. White Mountain Apache Tribe, 537 U.S. 465 (2003) ............................... passim

United States Department of Navy v. Egan, 484 U.S. 518 (1988) ............................................. 40

Urie v. Thompson, 337 U.S. 163 (1949) ..................................................................................... 45

Van Bourg v. Nitze, 388 F.2d 557 (D.C. Cir. 1967) ................................................................... 70

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Villeda Aldana v. Fresh Del Monte Produce, Inc., 305 F. Supp. 2d 1285 (S.D. Fla. 2003) ..................................................................................................................... 66

Vintilla v. United States, 931 F.2d 1444 (1991) ......................................................................... 36

Warth v. Seldin, 422 U.S. 490 (1975) ......................................................................................... 18

West v. MultiBanco Comermex, S.A., 807 F.2d 820 (9th Cir. 1987) ....................................... 66

Wilkerson v. United States, 67 F.3d 112 (5th Cir. 1995) ........................................................... 18

Wooden v. Bd. of Regents of the U. Sys. of Ga., 247 F.3d 1262 (11th Cir. 2001) .................... 19

Young v. United States, 535 U.S. 43 (2002) .............................................................................. 43

Zadvydas v. Davis, 533 U.S. 678 (2001) .................................................................................... 62

STATUTES

5 U.S.C. § 701(a)(2) .................................................................................................................... 48

5 U.S.C. § 701(b)(1)(G) .............................................................................................................. 49

5 U.S.C. § 704 ............................................................................................................................. 50

28 U.S.C. § 1350 ................................................................................................................... 64, 65

28 U.S.C. § 1367(a) .................................................................................................................... 18

28 U.S.C. § 2241 ................................................................................................................... 62, 64

28 U.S.C. § 2401(a) .................................................................................................................... 34

28 U.S.C. § 2679 ......................................................................................................................... 65

28 U.S.C. §2680(k) ..................................................................................................................... 66

APA, § 2(a)(4), 60 Stat. 237 (1946) ............................................................................................ 48

Pub. L. 102-256, 106 Stat. 73 (Mar. 12, 1992) ........................................................................... 65

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REGULATION

41 C.F.R. § 128-50.101 ............................................................................................................... 32

FEDERAL RULES OF CIVIL PROCEDURE

Fed. R. Civ. P. 1 .......................................................................................................................... 52

Fed. R. Civ. P. 12(g) ................................................................................................................... 51

OTHER AUTHORITIES

Agreement Between the Government of the United States and the Government of the HungarianPeople’s Republic Regarding the Settlement of Claims, 24 U.S.T. 522 (1973) ............. 55, 60

Exec. Order 8785 (June 14, 1941) .............................................................................................. 58

H.R. Rep. No. 102-367 (1991) .................................................................................................... 65

S. Rep. No. 102-249 (1991) ........................................................................................................ 65

Treaty of Peace with Hungary, Sept. 15, 1947 .................................................................... passim

13A Charles Alan Wright, et al., Federal Practice and Procedure § 3531.15, (2d ed. Supp. 2004) ............................................................................................................... 32

Gorelick, Marzen, Solum, Destruction of Evidence, § 2.5 (1989) ............................................. 29

Ronald W. Zweig, The Gold Train: The Destruction of the Jews and the Looting of Hungary (Penguin Books 2002) ............................................................................ 4

1 The number of factual assertions and theories in the 71-page Opposition necessitates a ratherlengthy reply.

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INTRODUCTION

The United States’ opening memorandum in support of its Motion to Dismiss the First

Amended Complaint (“Opening Memorandum”) explains the history of the Hungarian Gold Train

and the justness of the United States’ decision to turn over the property it found on the train for use

in assisting Jewish and other refugees in post-World War II Europe. The Opening Memorandum

also explains why this Article III Court is without subject matter jurisdiction over this lawsuit and

why the suit fails to state a claim upon which relief can be granted.

Despite its length,1 Plaintiffs’ Memorandum in Opposition to the United States’ Motion to

Dismiss (“Opposition”) puts forward no evidence that satisfies their burden to prove that they have

standing under both constitutional and prudential principles and that their claims are not barred by

the applicable statute of limitations. Plaintiffs cannot establish that the property which they are

claiming in this lawsuit was on the Gold Train when the U.S. Army took control of the train or that,

even if it had been, restituting it to Hungary — as Plaintiffs argue the United States should have done

— would have enabled them to regain possession of it. Plaintiffs also cannot demonstrate that they

should be permitted to assert rights that, under the theories of liability they have advanced, belong

to Hungary; Hungary waived any rights against the United States regarding the Gold Train property

through both the 1947 Treaty of Peace and its 1973 Settlement Agreement with the United States.

Plaintiffs also cannot demonstrate that equitable principles warrant tolling the six-year statute of

limitations (or otherwise suspending the accrual date on their causes of action) until the early 1990s,

more than four decades after the events that gave rise to their claims occurred. Likewise, Plaintiffs

cannot establish that Congress intended for the Administrative Procedure Act (“APA”) to provide

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the judicial review they seek of discretionary acts and decisions during the United States’ military

occupation in post-war Austria. Finally, the First Amended Complaint fails to state a claim upon

which relief can be granted for the reasons set forth in the Opening Memorandum and herein.

ISSUES OF FACT

Given that the United States’ motion presents a factual challenge to subject matter

jurisdiction and that there are a number of facts relevant to the history of the Hungarian Gold Train,

it is appropriate to clarify which facts are necessary to the Court’s determination of its jurisdiction

and which facts serve as background to that issue or relate to the ultimate merits of Plaintiffs’ claims.

I. Facts Necessary to Determination of Subject Matter Jurisdiction

A. Whether Property Belonging to Plaintiffs Came into the United States’ Possession(For Standing Determination)

It is undisputed that the Gold Train carried Jewish property and most likely carried some

property of some Jews who lived in the regions identified by Plaintiffs’ expert Gábor Kádár as well

as other parts of so-called Greater Hungary, (see Aff. of Gábor Kádár on History of the Hungarian

Gold Train ¶¶ 33-34 [“Kádár Aff.”] [Ex. 5 to Opening Mem.]). However, it is impossible to know

just what was on the train when the United States took control of it. There are numerous breaks in

the chain of custody between the time that Plaintiffs relinquished property to Axis Hungarian

authorities pursuant to Decree 1600 and the time that the U.S. Army took possession of the Gold

Train. Much of the property that Axis Hungary confiscated from Jews never arrived at central

collecting points due to bureaucratic disorganization and looting; some of the property that made it

to the collecting points was subsequently destroyed by events of war and some was stolen; some of

the property actually that was loaded onto the Gold Train was stolen, given away, or was offloaded

to make room for train passengers; and train commander Arpad Toldi made off with 44 or more

cases of the more valuable pieces of property that had been loaded onto the Gold Train, all before

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the Gold Train came into the possession of the U.S. Army near the end of World War II. (See

portions of Expert Report of Ronald W. Zweig, Ph.D. [“Zweig Report”], Second Expert Report of

Ronald W. Zweig, Ph.D. [“Zweig Rebuttal”], and Dep. of Pls.’ Expert Witness Gábor Kádár [“Kádár

Dep.”] cited in government’s Opening Mem. at 5-9.) In addition, much of the Jewish property

disappeared by less orderly means, in that it was seized by Hungarian soldiers directly from

Plaintiffs’ homes or their persons, seized by Nazi soldiers who ransacked deserted houses, or stolen

by their non-Jewish neighbors. (See Zweig Report at 9 [Ex. 1A to Opening Mem.].)

As explained below, the testimony of Plaintiffs Elisabeth Bleier, Erwin Deutsch, and Zoltan

Weiss, and the auction catalog excerpts on which Plaintiffs rely, do not establish that the property

which any Plaintiff is claiming in this lawsuit was on the Gold Train. See infra at 20-23.

B. Whether Any Conduct by the United States Led Plaintiffs to Miss theApplicable Filing Deadline (For Statute of Limitations)

Abandoning many of the allegations of their Amended Complaint, Plaintiffs’ Opposition

identifies the “deceptive” conduct by the United States that allegedly caused them to miss the filing

deadline for this action as the government’s handling and disposition of the Gold Train itself

(including representations made to representatives of the Hungarian Jewish community, to the

Hungarian government, and its decision to give the victim property found on the Gold Train to the

Inter-Governmental Committee on Refugees [“IGCR”]). (Opp’n at 47.) While the United States

disputes many of the asserted facts related thereto, none is relevant to the question whether Plaintiffs’

claims are time-barred. Plaintiffs have failed to identify any causal link between the United States’

actions vis a vis the Gold Train and their 40-year delay in filing suit.

As further evidence of “deceptive conduct,” Plaintiffs cite the government’s routine

classification and declassification of World War-II era records and suggest that the declassification

of Gold Train documents began only in 1998. It is undisputed that the United States declassified

2 On the cited pages of his book, Professor Zweig discusses the work of the IWG, which formed asa result of the Nazi War Crimes Disclosures Act of 1998, and states that two documents referenced in hisbook were declassified in 2001 as a result of the IWG’s efforts. See Ronald W. Zweig, The Gold Train: TheDestruction of the Jews and the Looting of Hungary, i-ix (Penguin Books 2002).

3 Plaintiffs’ only other source as to when the United States began declassifying Gold Traindocuments is deposition testimony by Mr. Kádár. His testimony on this subject is not credible andconstitutes inadmissible hearsay, as he has no first-hand knowledge. (See Kádár Dep. at 244:5-8 [“Q. Sothe only basis for your belief about when they were declassified is that you were told by your colleagues onthe Presidential Commission? A. My colleagues, exactly.”].)

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some documents related to the Gold Train in the late 1990s and early part of 2000 as part of the work

of the Nazi War Criminal Records Interagency Working Group (“IWG”). Professor Zweig, a

member of the Historians Advisory Panel of the IWG for the National Archives and Record

Administration (NARA), estimates that the number of documents relating to the Gold Train

declassified as a result of the IWG’s efforts “was about half a dozen pages.” (Zweig Dep. at 202:2-

203:14 [Ex. 1].) However, Plaintiffs’ statement that “Zweig informs us that declassification started

in 1998” is patently false and is not supported by their cited source: the acknowledgments of

Professor Zweig’s book, which discuss the IWG’s efforts.2 Plaintiffs’ assertion likewise is contrary

to the testimony of the Director of the Initial Processing/Declassification Division at NARA that

information related to the Gold Train has been declassified and available to the public for at least

20 years. (Decl. of Jeanne Schuable, ¶ 7 [Ex. 4 to Opening Mem.].) By way of example, Ms.

Schuable further attests that NARA’s Record Group 260, which contains two boxes containing

materials specifically related to the Gold Train, was declassified and made available to the public

in late 1982.3 (Id.)

Plaintiffs present no evidence that the United States’ classification of documents containing

information on the Gold Train contributed to their having missed the applicable filing deadline. In

fact, when asked in his deposition, Plaintiffs’ primary expert witness, Gábor Kádár, could not

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identify any recently declassified document by name, let alone one that revealed critical, previously

unknown information about the Gold Train. (See Kádár Dep. at 230:9-14 [Ex. 3].)

Lastly, Plaintiffs present no evidence demonstrating, or even suggesting, that a document was

classified improperly, and any suggestion that the United States classified documents in order to

cover up the facts of its handling the Gold Train is baseless.

C. When Plaintiffs Reasonably Could Have Exercised Due Diligence to Learn about theGold Train (For Statute of Limitations)

Plaintiffs do not dispute that major newspapers in the United States and abroad in the 1940s

published accounts of U.S. involvement with the Gold Train that contain all of the basic information

necessary to the accrual of their claims. (See articles at Ex. 8 to Opening Mem.; official copies

attached at Ex. 14.) They also do not dispute that representatives of the Hungarian Jewish

community had actual, contemporaneous knowledge that the United States found the Gold Train in

Austria and that it turned over the property to the IGCR. (See Kádár Rep. at 26-34 [Ex. 3].)

Nevertheless, Plaintiffs misconstrue the reason the United States offers this evidence, (Opp’n at 42-

46), which is to demonstrate that the information Plaintiffs needed to file their claims has always

been publicly available. Contemporaneous newspaper accounts and post-war Jewish leaders are

sources of knowledge that Plaintiffs reasonably could have been expected to tap if, at any time, they

sought information about their lost property.

Many of Plaintiffs’ putative class representatives spent time in Budapest in the years

immediately after the War. (See Excerpted Details of Named Plaintiffs’ Postwar Years [Excerpts

of Plaintiffs’ Postwar Years], attached at Appendix A.) And, by the mid 1950s, most of Plaintiffs’

putative class representatives had settled in urban areas either in Canada or in the United States,

including Miami, Montreal, New York, and Toronto. (See id.) In North America, the Plaintiffs

pursued diverse occupations and lived generally prosperous lives. Id. (describing, e.g., careers in

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medicine [Joseph Devenyi], chemistry [Peter Drexler], machine design [Michael Fried], and academia

[Paul Gottlieb]). Many returned to Hungary to visit over the years, some to visit family and friends

who lived there. (See Excerpted Details of Named Plaintiffs’ Visits to Hungary [Excerpts of Visits],

attached at Appendix B.) Mr. Tomas May has lived his entire life in Budapest. (Dep. of Tomas May,

at 7:3-8 [Ex. 22].)

Several Plaintiffs had some contact with or knowledge of events related to the Gold Train

prior to the 1990s. (See Excerpted Details of Plaintiffs’ Pre-1990 Gold Train Knowledge [Excerpts

of Pre-1990s Knowledge], attached at Appendix C.) For example, Mrs. Elisabeth Bleier and her

father attended an auction in New York in 1950, where they found a Kiddish cup that had been

stolen from Hungary during the war. (Dep. of Elisabeth Bleier, at 49:2-20, 59:23-60:3 [Ex. 22].)

Mr. Peter Drexler heard a British Broadcasting Corporation (BBC) radio report on the Gold Train

in the1970s, from which he remembers learning that after World War II, a 30-wagon train had been

found in Austria “probably in the American sector,” loaded with Jewish property “with tremendous

value.” (Dep. of Peter Drexler, at 44:3-13, 64:16-24 [Ex. 22].) And, when asked when he first heard

about the Gold Train, Mr. May responded that he remembers that, sometime between 1945 and 1950,

his parents told him about a train that had been found with Jewish belongings or gold items on it.

(Dep. of Tomas May, at 34:20 to 37:25 [Ex. 22].)

II. Additional Facts Relevant to Background and Merits of Plaintiffs’ Claims

A. Whether the Gold Train Property That Came into U.S. Possession Was Identifiableas to Individual Ownership

The question of whether the property was identifiable as to individual owner turns on whether

the Army, between 1945 and 1947, could have identified, as a practical matter, specific items of

4 There is no dispute that the property on the Gold Train was mostly Jewish in origin, with theexception of art from the Gyor museum and the personal belongings of Axis Hungarian officials and theirfamilies who fled Hungary on the train. It is simply not true that “[f]or years the Government claimed it didnot know what was on the train, or that there was any proof that Jewish property was on the train,” asPlaintiffs assert, (Opp’n at 4.) The deposition of Cody Phillips, a staff curator at the Center for MilitaryHistory, which Plaintiffs cite, does not support their accusation. The cited deposition excerpt concerns ashipment of property from the train which carried gold of the Hungarian National Bank and which the UnitedStates restituted to Hungary, a different train from the train that is the subject of this lawsuit. (See Dep. ofR. Cody Phillips at 56:24-25 to 57:1-2 [identifying “shipment No. 20” that is subject of questioning asconsisting of “Hungarian National Bank gold”] [Ex. 5].) Mr. Phillips stated that Army documents indicatethat the shipment of property from the Hungarian National Bank train included no Jewish property. (Id.)

5 Dr. White explained, “To go through cases with thousands or tens of thousands of gold rings andto look for initials and then assume that the ring that has WFB on it or WB, as my wedding ring does, belongsto this particular person with those initials or to someone else, it seems to me to be the definition ofimpracticality.” (White Dep. at 53:2-8 [Ex. 2].)

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property from the Gold Train as belonging to specific individuals.4 (See Dep. of Elizabeth Barrett

White, Ph.D. at 53:9-17 [“White Dep.”] [Ex. 2]; accord Dep. of Professor Ronald W. Zweig at

141:15-18, 145:1-4, 149:10-28 & 150:1-3 [“Zweig Dep.”] [Ex. 1].) The answer clearly is no. By

the time the U.S. Army took control of the Gold Train, Toldi and his men had actively destroyed

evidence of individual provenance and broken up much of the jewelry so as to separate stones from

settings. (See portions of Zweig Report and Kádár Dep. cited in U.S. Opening Mem. at 6-7.) That

individual pieces of jewelry or silverware may have been engraved with initials or even last names

does not render those pieces identifiable to specific persons out of the hundreds of thousands of Jews

whose property Axis Hungarian authorities had stolen. (See, e.g., White Dep. at 53:2-8 [Ex. 2].5)

Plaintiffs suggest that if they, or other Jews whose property was taken by Axis Hungary, had

had access to the Gold Train property they could have identified any pieces that belonged to them.

(Opp’n at 26.) However, as set forth above, the determination of whether property was “identifiable”

is made from the perspective of the Army and not the individual. (White Dep. at 53:9-17 [Ex. 2];

accord Zweig Dep. at 141:15-18, 145:1-4, 149:10-28 & 150:1-3 [Ex. 1].) Indeed, it would not make

sense for the identifiability determination to be made from the perspective of the individual owner

6 To be sure, one individual who may have been Jewish was permitted access to the Salzburgwarehouse to search for specific items of property but did not find any of them. (Zweig Dep. at 111:20-28& 112:1-9 [Ex. 1].) That property had never been part of the Gold Train property. (Mem. of Nov. 5, 1947granting permission to enter Salzburg warehouse [Ex. 10].) Additionally, two Axis Hungarian officials wereallowed to claim personal luggage that had been on the Gold Train. The two were civilians who had traveledon the train and their luggage was labeled with their names. (Zweig Dep at 112:21-28 & 113:1-9.) Thevictim loot on the train, of course, was in a very different state. See U.S. Opening Mem. at 6-7 (citing ZweigRep.).

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because there was no practical way for individual owners to attempt to identify property from the

Gold Train as theirs. (See Zweig Dep. at 149:10-28 & 150:1-3.) It would not have been possible

for the Army, given its limited resources, to set up and manage a process whereby the hundreds of

thousands of Jews from whom Axis Hungary had confiscated property, or heirs of such Jews, would

be able to search through the tons of Gold Train property of which the Army had taken control and

make claims for individual pieces that the Army would have had no means of verifying.6 (See id.;

The U.S. Army in Post-War Austria and Hungarian Restitutions, Expert Report of Jeffrey J. Clarke,

Ph.D. at 4-5, 8 [“Clarke Expert Rep.”] [Ex. 3 to U.S. Opening Mem.].) One could expect substantial

fraud in such a process through which impoverished refugees could make claims on a items among

the vast quantity of jewelry and other valuables that had been rendered untraceable by Axis Hungary

officials. (See Zweig Dep. at 149:10-28 & 150:1-3 [Ex. 1].)

B. Whether Gold Train Property that Came into U.S. Possession was Identifiable as toNational Origin

The question of whether the Gold Train property was “identifiable as to national origin”

similarly turns on whether the Army practicably could have determined from what country specific

items had come. (See White Dep. at 32:17-21 [Ex. 2].) Axis Hungary seized property belonging

to Jews of so-called Greater Hungary, which included present-day Hungary plus portions of

Romania, Czechoslovakia, and the former Yugoslavia that Hungary had annexed during World War

II. (White Decl. ¶ 23 [Ex. 2 to Opening Mem.]; White Dep. 42:21-25 & 43:1-13 [Ex. 2]; accord

7 Plaintiffs’ assertion that the United States restituted the railcars of the Gold Train to Hungary eventhough some of the cars had markings of other countries, (Opp’n at 25-26), is unsupported by the excerpt ofProfessor Zweig’s deposition that they cite. In the cited passage, Professor Zweig explained that the UnitedStates sent the Hungarians who had been traveling on the Gold Train on two of the Gold Train railcars, whichwere attached to a “repatriation train” on its way back to Hungary. (Zweig Dep. at 86:12-25 [Ex. 1].)

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Kádár Aff. ¶ 33 [Ex. to 5 Opening Mem.].) Thus, property from Jews who lived throughout Greater

Hungary was likely on the Gold Train. (See id.) After the war, Hungary’s borders reduced to their

present state, and the annexed territories were returned to the countries of Romania, Czechoslovakia,

and the former Yugoslavia. Treaty of Peace with Hungary, Sept. 15, 1947, art. 1, 61 Stat. 2065

(“Treaty of Peace”). Consequently, the property on the Gold Train that came into the United States’

possession likely originated from not just Hungary but also from Romania, Czechoslovakia, and the

former Yugoslavia. There is no evidence of any way in which the Army could have determined

which items came from Hungary and which came from Romania, Czechoslovakia, or the former

Yugoslavia. (See White Dep. at 46:7-19 [Ex. 2].) Given that the Gold Train property could not be

identified by country of origin, the property could not be restituted to Hungary because such a

restitution would not have provided any practical means whereby property from the formerly

annexed territories could have been returned to its owners. See infra at 13-15.

Contrary to Plaintiffs’ argument, (Opp’n at 25-26), restitutions that the United States made

to other countries whose borders had shifted during the war, including Hungary, are not inconsistent

with its decision not to restitute the Gold Train property to Hungary.7 It was appropriate to restitute

property to a country whose borders had shifted during the war so long as it could be determined that

the assets had come from territory that was encompassed by the country’s post-war borders.

(See White Dep. at 32:19-21 [Ex. 2].) For example, if property was identifiable as having come

from Budapest, it was to be returned to Hungary because the post-war border shift of the annexed

territories had no effect on whether the assets could be identified as Hungarian. Likewise, if property

8 As referenced in the Opening Memorandum and herein, it is highly improbable that the Armypersonnel who took control of the Gold Train would have had contracting authority that would haveempowered them to bind the United States in a contract with an enemy state with which the United Stateswas still at war. See infra at 64; Opening Mem. at 51.

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could be identified as having come from a part of Poland that had been part of Germany during the

war, it was to be returned to Poland.

C. Whether the United States Promised Officials of the Axis Hungarian GovernmentThat it Would Safeguard Gold Train Property until it Could Be Returned to the Jewsfrom Whom it Was Confiscated

The only evidence supporting Plaintiffs’ claim that upon taking control of the Gold Train the

United States promised that it would safeguard the property onboard until it could be returned to its

Jewish owners is the self-serving statement made by Avar and two of his subordinates during their

post-war interrogation by Hungarian authorities. Avar and the subordinates purportedly told the

interrogating authorities that U.S. Army officers had made verbal promises to return the property to

“those from whom [it was] taken” but refused to put the promises in writing.8 (Kádár Aff. ¶ 51

[quoting Report of Avar, Mingovits and Biro] [Ex. 5 to Opening Mem.].) Professor Zweig explained

that the context in which that statement was made is significant and that, in its context, the statement

should be viewed “an attempt by government official[s] to justify [their] guardianship of the material

that [Avar had] lost to the Americans, so [they were] inventing all sorts of stories about the whole

process.” (Zweig Dep. at 74:1-9 [Ex. 1].)

It is also important to observe that Avar and his subordinates were officers of the Axis

Hungarian government that had stolen Jews’ property. There is no reason to believe that they had

the interests of those same Jews in mind when they relinquished custody of the train to the U.S.

Army. (See Kádár Dep. at 114:10-12 [stating that he knows of no evidence that Avar was

sympathetic to Jews] [Ex. 3].) On the other hand, it is undisputed that Avar and his men were facing

desperate circumstances, fending off SS soldiers, Toldi, and other Hungarians who wished to steal

9 The Army prepared a rough inventory of the Gold Train’s contents when it took control of the trainand later prepared a more detailed, but not item-by-item, list of the cargo. (E.g., Zweig Dep. at 74:13-28 &87:8-13 [Ex. 1]; White Dep. at 52:12-19 [Ex. 2].) Given the mass of property and the Army’s limitedresources, an item-by-item list was not practicable. See Mem. from Property Control Officer Homer Hellerto Chief, Property Control Branch of 10/21/45 [“Because of the magnitude of the task a detailed inventoryhas not been taken, however, a general inventory and history was prepared . . .”] [Ex. 8].) Moreover, theProvisional Handbook for Military Government in Austria (“Provisional Handbook”), which Plaintiffs sofrequently cite, did not require it. (Provisional Handbook at 195 § 144(b) [Ex. 6] [providing that detailedinventories were not to be prepared unless there were special circumstances].)

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the property, and avoiding bombings and skirmishes with Allied soldiers. (See Am. Compl. ¶¶ 187-

88.) Avar and his men were in no position to bargain for anything from the U.S. Army.

D. The United States’ Efforts to Safeguard the Gold Train Property

The Expert Report of Dr. Jeffrey Clarke, Chief Historian of the U.S. Army’s Center for

Military History, explains that following World War II in Europe, the U.S. Army was responsible

for providing food, shelter, medicine, and clothing to a staggering number of people in the areas the

United States occupied. (Clarke Report at 4-7 [Ex. 3A to Opening Mem.].) In the U.S. occupation

zone of Austria (where the U.S. Army took possession of the Gold Train and stored property from

the train), there were approximately one million displaced persons in mid-1945 (the time that the

Army took the Gold Train and stored the property). (Id. at 4.) In addition to providing basic

sustenance to millions of displaced persons and prisoners of war, as occupation authority the Army

was responsible for providing all government services. (Id. at 7.) It is against this backdrop that the

Army’s decisions about how detailed an inventory to take of the Gold Train property,9 and how many

personnel to devote to providing security for the property must be viewed.

Because the Army’s resources were stretched thin by all of its responsibilities in post-war

Europe and because it had to give greater priority to providing food, shelter, medicine, and clothing,

it could assign only a limited number of personnel to safeguard property stored at the Salzburg

warehouse. (See id. at 4-8.) Nevertheless, the Army considered managing looted property to be an

10 There had been no precedent in modern times for what the Nazis and Hungarians had done to theirown citizens.

11 Notwithstanding that property found on the Gold Train could properly be requisitioned undergoverning regulations, as the realities of the Holocaust and the origin of certain property became more clearover time, the requisitioning from the Salzburg warehouse was ordered to cease, as “there is evidence thatthis property belongs to Hungarian Jews.” (See Zweig Rep. at 32 [Ex. 1A to Opening Mem].)

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important task, (id. at 8; Zweig Report at 33), and tried, convicted, and sentenced soldiers for theft

from the warehouse, (Zweig Report at 33). There is also evidence that the Army increased security

measures at the Salzburg warehouse in response to reports of theft. (Property Control Section

Monthly Report dated July 1, 1946 ¶ 6 [Ex. 9].)

E. Scope of and Authority for the Requisitioning of Property from the Gold Train

The U.S. Army requisitioned materials seized from enemy nationals, defined as nationals of

enemy states, e.g., Axis Hungary, Provisional Handbook for Military Government in Austria, ch.

VIII, § IX ¶149(f)(1)(D), to be made available for practical Army uses such as furnishing living

quarters of Army personnel. Contrary to Plaintiffs’ suggestion, at the end of World War II, there was

no provision in international law or U.S. regulations for treating victimized nationals of enemy states

differently than other enemy nationals.10 Accordingly, property from the Gold Train, which the U.S.

Army took from armed Axis Hungarian officials, would have been properly available for

requisitioning.11

The sort of property subject to requisitioning were household items such as cutlery and table

cloths, not jewelry or other property of high value. (Zweig Dep. at 126:18-19 [Ex. 1].) Professor

Zweig explained that it is likely that only an “insignificant amount” of Gold Train property was

requisitioned. (Id. at 126:11-15.) Morever, Plaintiffs identify no evidence that requisitioning

continued after a general instructed that it cease in light of evidence that the property had come from

Hungarian Jews.

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F. Why the United States Decided to Turn over Gold Train Property to the IGCR

Plaintiffs’ repeated assertion that the United States violated applicable restitution policy and

law when it turned over victims’ property found on the Gold Train to the IGCR in November 1947

is incorrect. The United States properly determined that the property on the Gold Train could not

be restituted to Hungary because it was multi-national in origin and, as the evidence of individual

ownership had been destroyed by Axis Hungary, it was not practicably possible to determine what

specific items on the train originated from territory where Hungary was the existing government after

the war and what items originated from territories that had reverted to Czechoslovakia, Romania or

Yugoslavia. As neither the national origin nor the individual ownership of the property on the Gold

Train was practicably determinable, the property was not subject to restitution.

In January 1946, the Allied powers decided what reparations Germany would pay to the

countries against which it had waged aggressive war. Reparation from Germany, Establishment of

Inter-Allied Reparation Agency, and Restitution of Monetary Gold (“Paris Reparation Agreement”),

Jan. 14, 1946, 61 Stat. 3157, T.I.A.S. No. 1655. Although historically reparations were paid only

to nations, the Allies adopted the United States’ proposal that the “nonrepatriable victims of German

action” should constitute a separate class eligible for reparation. Id. Article 8 of the Paris

Reparation Agreement provided that the reparation to be paid to this class would consist, inter alia,

of “all the non-monetary gold found by the Allied Armed Forces in Germany.” Id., art. 8.

Although the Paris Reparations Agreement did not define “non-monetary gold,” the intention

of the provision was to make available valuables that belonged to Nazi victims but were not capable

of being restituted. See id. The Five Power Conference, which met in June 1946 to settle

arrangements for carrying out Article 8, see Reparation to Nonrepatriable Victims of German Action,

June 14, 1946, 61 Stat. 2649, T.I.A.S. No. 1594, also did not define non-monetary gold, thus leaving

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each of the occupying powers free to decide how to apply Article 8 to property seized in the area

under its control. The United States decided that non-monetary gold should be defined to include

all assets that constituted the valuable personal property of victims and that could not be restituted,

regardless of whether the assets were gold or where they were found. (See Nov. 7, 1946 decision

of State-War-Navy Coordinating Committee on definition of non-monetary gold [Ex. 46 to Pls.’

Opp’n].) Pursuant to this decision, the Joint Chiefs of Staff issued the non-monetary gold directive,

WX-85682. (See WX-85682 [Ex. 11].) As the property on the Gold Train met the definition of non-

monetary gold in this directive, the Army accordingly turned the property over to the IGCR.

Plaintiffs’ assertion that the United States’ disposition of the Gold Train property violated

applicable restitution policy relies instead on policies developed to govern restitutions to ex-enemy

nations. (See Supplemental Expert Report and Aff. of Jonathon Petropoulos, Ph.D. at 8-9

[“Petropoulos Supp. Aff.”] [Ex. 7 to Opening Mem.].) On November 29, 1945, the Joint Chiefs of

Staff issued a directive to the Commanding General of U.S. Forces Austria, which ordered

immediate restitution to friendly countries of all “[other] goods, valuables . . , materials, equipment,

livestock and other property found in storage or otherwise in bulk form and identified as having been

looted or acquired in any way by Germans from United Nations during German occupation.” WX

85965 (Nov. 30, 1945), attached as Ex. 13. On March 4, 1946, the United States extended this

restitution policy to ex-enemy nations, including Hungary, requiring restitution of “other goods,

valuables (excluding gold, securities, and foreign currencies, materials, equipment, livestock and

other property found in storage or otherwise in bulk form.” WX 99226 ¶ 2.B, attached as Ex. 12.

Importantly, restitution pursuant to these policies turned on identification of the national origin of

the property in question, as well as on submission by the claimant government of satisfactory proof

“that the property in question was acquired by Germany as the result of an act of force or was

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removed into Germany or Austria without compensation.” Id. Plaintiff’s contention that the

victims’ property found on the Gold Train should have been returned to the Hungarian Government

pursuant to WX 99226 is entirely predicated upon the assertion that the property was identifiable as

Hungarian in national origin, which it was not. As explained above, the property on the Gold Train

likely originated from several nations in addition to Hungary. As the property was not identifiable

as to national origin, WX 99226 did not apply.

Because the United States determined that the property found on the Gold Train had belonged

to victims of the Holocaust, but that identification of national origin and individual ownership was

impracticable, the United States properly turned over the property to the IGCR for the benefit of

victims of Nazi persecution pursuant to WX 85682, which stemmed from accepted international

policy for reparations to victims, rather than pursuant to WX 99226.

ARGUMENT

I. Plaintiffs Fail to Establish Subject Matter Jurisdiction

The myriad factual assertions and theories set forth in Plaintiffs’ Opposition notwithstanding,

the jurisdictional issues presented to the Court are straightforward. Have Plaintiffs met their burden

of proving that the property on which they base their claims was in fact on the Gold Train when the

United States took control of the train? Have Plaintiffs met their burden of proving that they would

have recovered their property if the United States had restituted it to Hungary? Have Plaintiffs

demonstrated that the Court should permit them to assert rights of Hungary vis-a-vis Gold Train

property notwithstanding Hungary’s waiver of any such rights? Have Plaintiffs shown that they

exercised diligence in seeking information about their lost property and that they relied detrimentally

on affirmative representations of the United States that caused them to miss the statutory filing

deadline? Did Congress intend for Article III courts to judge, based on international-law standards

12 The Garcia court found that because the question whether the defendant is “an employer” isrelevant to whether the Age Discrimination Employment Act (ADEA) applies in the first place and also isan element of the substantive cause of action, employer status “is a substantive element of an ADEA claimand intertwined with the question of jurisdiction.” Garcia, 104 F.3d at 1262; accord Morrison, 323 F.3d at929-30 (same as to “employee” status under the Family Leave and Medical Act).

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and military handbooks and manuals, discretionary acts and decisions concomitant to the U.S.

military occupation in Austria? For the reasons set forth below and in the Opening Memorandum,

the Court should answer each of these questions in the negative and conclude that Plaintiffs have not

satisfied their burden of proving subject matter jurisdiction.

A. Factual Determination for Fed. R. Civ. 12(b)(1)

The United States’ challenge to subject matter jurisdiction under Rule 12(b)(1) relies on facts

which, for the most part, are undisputed. See supra at 2-6. Any necessary factual findings are well

within this Court’s authority to make in order to assure itself of its power to hear the case. Morrison

v. Amway Corp., 323 F.3d 920, 925 (11th Cir. 2003).

Contrary to Plaintiffs’ assertion, (Opp’n at 13-14), this motion does not implicate the narrow

exception to this rule for cases in which the facts necessary to sustain jurisdiction also implicate the

merits of a cause of action. Id. Jurisdiction is intertwined with the merits of a cause of action

“when a statute provides the basis for both the subject matter jurisdiction of the federal court and the

plaintiff's substantive claim for relief.” Id. (Garcia v. Copenhaver, Bell & Assoc., 104 F.3d 1256,

1262 [11th Cir. 1997]12). No such specific overlapping question exists here. Accordingly, the Court

may make any factual determination necessary to its consideration of the Rule 12(b)(1) motion.

B. Each Plaintiff Must Establish Standing

Plaintiffs’ assertion that “Article III standing for one party and one claim is sufficient to

confer jurisdiction,” (Pls.’ Opp’n at 14), is flatly wrong. It is well-established that each named

plaintiff before the Court must establish standing to pursue the claims asserted in the lawsuit. E.g.,

13 American Iron & Steel Inst. v. OSHA, 182 F.3d 1261 (11th Cir. 1999), does not support Plaintiffs’contention to the contrary. Because that case involved a challenge to a regulatory standard, there was noneed for the court to go through a standing analysis for each plaintiff; so long as one had standing, reliefwould extend automatically to all plaintiffs if the action were successful. See id. at 1274 n.10 (citing PlannedParenthood of the Atlanta Area, Inc. v. Miller, 934 F.2d 1462, 1465 n. 2 [11th Cir.1991]). Here, by contrast,each Plaintiff is seeking monetary relief. Prado-Steinman v. Bush, 221 F.3d 1266, 1280 (11th Cir. 2000),on which Plaintiffs also rely, addresses standing requirements for class certification and does not address thefundamental principle that each named plaintiff in a lawsuit have standing.

Plaintiffs similarly misapply the doctrine of supplemental jurisdiction under 28 U.S.C. § 1367(a) tothis case. (Opp’n at 14-15.) That doctrine’s provision for courts to exercise their discretion to considerclaims outside their original jurisdiction, 28 U.S.C. § 1367(a), has nothing to do with the requirement ofstanding, which relates to whether a particular litigant is entitled to have his/her claim decided, e.g., Warthv. Seldin, 422 U.S. 490, 498 (1975). Likewise, supplemental jurisdiction cannot serve to confer jurisdictionthat is lacking by virtue of sovereign immunity, which is the case here given the statute of limitations andlack of applicable waiver under the APA and the Little Tucker Act. See, e.g., United States v. Certain LandSituated in City of Detroit, 361 F.3d 305, 308 (6th Cir. 2004) (“[Section 1367] does not constitute a waiverof sovereign immunity.”); Wilkerson v. United States, 67 F.3d 112, 119 n.13 (5th Cir. 1995) (“Section1367(a), however, deals only with the federal courts' power to exercise subject matter jurisdiction overcertain claims and does not operate as a waiver of the United States sovereign immunity.”).

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Johnson v. Bd. of Regents of the Univ. of Georgia, 263 F.3d 1234, 1267 n.29 (11th Cir. 2001)

(recognizing that Supreme Court clarification of nature of requisite injury for standing “did not alter

the requirement that each plaintiff establish additional prerequisites to have standing . . .”) (emphasis

supplied); Phelps v. Hamilton, 122 F.3d 1309, 1316 (10th Cir. 1997) (“The essence of the standing

doctrine is that each plaintiff must allege a personal injury fairly traceable to [the defendant’s]

allegedly unlawful conduct and likely to redressed by the requested relief.”) (emphasis supplied);

Estate of Cabello v. Fernandez-Larios, 157 F. Supp.2d 1345, 1353-58, 1369 (S.D. Fla. 2001)

(analyzing standing of each plaintiff in case brought by five plaintiffs and dismissing claim of one

of five who lacked standing).13 Here, the Court has already recognized as much. See Rosner v.

United States, 231 F. Supp. 2d 1202 1205 n.2 (S.D. Fla. 2002) (requiring Plaintiffs to “demonstrate

identifiable property” in order to pursue a claim for an implied-in-fact contract for bailment).

14 Thus Midrash Sephardi, Inc. v. Town of Surfside, 366 F.3d 1214, 1223 (11th Cir. 2004), on whichPlaintiffs rely, should not be read to suggest that factual allegations are sufficient to confer standingregardless of the stage of the litigation. To do so would conflict directly with well-established precedent.See, e.g., Bennet v. Spear, 520 U.S. 154, 167-68 (1997) (describing varying degrees of evidence for differentstages of litigation) (citing Lujan); Bischoff, 222 F.3d at 878 (same). Indeed, Midrash Sephardi did notinvolve disputed facts that impacted standing. See Midrash Sephardi, Inc., 366 F.3d at 1223-25.

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1. None of the Plaintiffs Has Constitutional Standing

a. Because the Government Presents a Factual Challenge to Standing, PlaintiffsCannot Rely on Mere Allegations

Plaintiffs argue that the allegations of the First Amended Complaint are sufficient to establish

standing. (Opp’n at 17.) But because the government’s challenge to standing is factual not facial,

Plaintiffs bear the burden of proving facts that support standing. See, e.g., Bischoff v. Osceola Cty.,

222 F.3d 874, 878 (11th Cir. 2000) (“The party invoking federal jurisdiction bears the burden of

proving standing. Moreover, each element of standing ‘must be supported in the same way as any

other matter on which the plaintiff bears the burden of proof, i.e., with the manner and degree of

evidence required at the successive stages of the litigation.’”) (quoting Lujan v. Defenders of

Wildlife, 504 U.S. 555, 561 [1992]).14 Indeed, the Court has ruled that it will decide the question

of jurisdiction before any consideration of the merits of Plaintiffs’ claims. Rosner, 231 F. Supp.2d

at 1218. Thus, Plaintiffs must prove facts which demonstrate that each is properly before the Court;

they cannot rely on mere allegations. See Lujan, 504 U.S. at 561 (“[A]t the final stage [of litigation],

those facts [demonstrating standing] (if controverted) must be supported adequately by the evidence

adduced at trial.”) (internal quotation omitted). That the case is brought as a class action does not

alter the obligation of each named Plaintiff to establish standing. Wooden v. Bd. of Regents of the

U. Sys. of Ga., 247 F.3d 1262, 1283 n.20 (11th Cir. 2001).

The government’s argument is not based on a theory that the Gold Train property which came

into U.S. possession “must have been owned by other Hungarian Jews [than the Plaintiffs],” as

15 As Plaintiffs observe, if the Court concludes that it must resolve factual disputes or makecredibility determinations to decide the question of standing, an evidentiary hearing is appropriate. SeeBischoff, 222 F.3d at 878.

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Plaintiffs suggest, (Opp’n at 23). Rather, the government submits that Plaintiffs cannot meet their

burden of proving facts that demonstrate the critical standing element of traceability, viz., that the

United States bears responsibility for the loss of their property.15

b. Plaintiffs Cannot Prove That Their Property Was on Gold Train When theArmy Took Control of the Train

Plaintiffs assert that their own testimony “prove[s] their property was in U.S. custody.”

(Opp’n at 17.) However, the only Plaintiff testimony they submit in support of that claim is from

Plaintiffs Elisabeth Bleier, Erwin Deutsch, and Zoltan Weiss. (Id. at 18-19.) Testimony of only

three Plaintiffs, even if it were sufficient to establish standing for those three (which it is not, as

explained below) cannot satisfy Plaintiffs’ burden of establishing that each named Plaintiff has

standing. See supra at 17-18. Moreover, the testimony Plaintiffs present on behalf of Mrs. Bleier,

Messrs. Deutsch and Weiss does not prove that particular items on the Gold Train when the U.S.

Army took it into custody belonged to those Plaintiffs.

Testimony of Mrs. Elisabeth Bleier: Plaintiffs rely on testimony of Mrs. Bleier in which she

identifies items displayed in a Parke-Bernet auction catalog as hers. (Opp’n at 18.) But Mrs.

Bleier’s testimony does not demonstrate that the items were one-of-a-kind or that they came from

her or her family as opposed to someone else who owned a similar or identical item. Contrary to

Plaintiffs’ characterization of Mrs. Bleier’s testimony in their brief, she never stated that any of the

property she claims in this lawsuit was “handmade” or “hand painted.” With regard to what

Plaintiffs’ brief describes as a “handmade handbag,” Mrs. Bleier explained that “everyone who was

somebody should have a bag like that.” (Dep. of Elisabeth Bleier at 84:9-10 [Ex. 22].) Further, the

auction catalog on which Plaintiffs rely describes a gold mesh handbag with a gold-link chain and

16 Mrs. Bleier obviously cannot base her claims on the Kiddish cup as her father recovered it.

17 What does follow is that Mrs. Bleier was on notice that she may have been able to trace other ofher and her family’s property by investigating how the Kiddish cup arrived at the auction. Thus, even if Mrs.Bleier were found to have standing, her claims are untimely. See infra at 43 n.38.

18 Even if Mrs. Bleier, Mr. Deutsch, and Mr. Weiss could establish that their property came into U.S.custody, their claims are nevertheless outside the Court’s jurisdiction and deficient for the other reasonsstated in the Opening Memorandum and herein.

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“set with seventy-eight small old-mine diamonds,” having a snap set with “two pear-shaped

diamonds,” and having a total weight of diamonds of approximately 2.50 carats. (Ex. 8 to Bleier

Dep. [page 64 of catalog] [Ex. 15].) Mrs. Bleier described the handbag she owned as “silver, like

a silver mesh made, silver and gold mesh” and made no mention of diamonds, (Bleier Dep. at 84:6-

8), which appear to have been the distinguishing characteristic of the bag pictured in the auction

catalog, (see Ex. 8 to Bleier Dep. [page 64 of catalog]).

Plaintiffs’ brief incorrectly describes as “distinctive hand painted jewelry” what was in fact

a rug that Mrs. Bleier testified belonged to her mother. (See Bleier Dep. at 90:24-25 [referring to

pages 74-75 of catalog, Ex. 8 to Bleier Dep.].) Moreover, Mrs. Bleier described the rug as “[v]ery

famous,” rather than unique, and the auction catalog does not describe the rug depicted as a one-of-a-

kind. (Ex. 8 to Bleier Dep. [page 74-75 of catalog].) Regarding the broach described as belonging

to Mrs. Bleier’s mother, (Opp’n at 18), Mrs. Bleier stated only, “Yeah I think so [that it was her

mother’s].” (Bleier Dep. at 85:8 [emphasis supplied].) Lastly, simply because the Kiddish cup that

Mrs. Bleier’s father retrieved from a New York auction appears to have been on the Gold Train,16

it does not follow that other property of Mrs. Bleier and her family was on the train when it came

into U.S. possession.17 As discussed in the Opening Memorandum at 5-9 and herein, see supra at

2, much of the property seized from Jews never made it onto the Gold Train, some property was

looted, and Toldi took much of the property from the train before it came into U.S. custody.18 There

19 None of the paintings that Plaintiffs have identified as similar to ones taken from their families isamong the nine paintings that were lost.

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is no reason to believe that all of the items seized from Mrs. Bleier and her family were kept together

given that Toldi and his men sorted the property by type. There is no evidence that Toldi was at all

concerned with keeping pieces from individuals or families together.

Testimony of Messrs. Erwin Deutsch and Zoltan Weiss: Similarly, the testimony of Messrs.

Eriwn Deutsch and Zoltan Weiss does not establish that paintings belonging to them or their family

members were on the Gold Train. According to Plaintiffs’ expert Gábor Kádár, the Gold Train

contained “about 100” paintings, mainly from the western Hungarian town of Gyor. (Kádár Dep.

at 139:6-9 [Ex. 6 to Opening Mem.]; accord Zweig Report at 40 [Ex. 1A to Opening Mem.].) Mr.

Kádár and Professor Zweig agree that the paintings from the museum in Gyor were returned to the

museum. (Zweig Report at 40; Kádár Dep. at 141:2-3.) While Professor Zweig believes that this

was all of the paintings on the Gold Train, Mr. Kádár believes that some of the 100 or so paintings

on the train were not from the museum. (Id.) Plaintiffs have cited a list of 1226 paintings entitled

“List of Unidentified Paintings Stored at Residenz-Depot, Salzburg.” (See Petropoulos Supp. Aff.,

Ex. A [Ex. 7 to Opening Mem.].) While there is no evidence as to where these 1226 paintings came

from, the research of Professor Zweig and Mr. Kádár makes clear that a very small percentage of the

1226 paintings came from the Gold Train and most, if not all of these, were from the museum at

Gyor. The paintings on this list were transferred to the custody of the Austrian government when

the United States left Austria, and were later returned to Hungary, with the exception of nine

paintings which were apparently lost by the Austrians.19 (See Petropoulos Dep. 132-34 [Ex. 4].)

Messrs. Deutsch’s and Weiss’ reliance on entries from the document listing 1226 paintings

that were apparently stored in Salzburg does not provide them with standing. First, as noted, it is

20 Mr. Deutsch identified a painting described only as an unframed 85 X 50 cm “Portrait of a ladyin a green dress,” with no artist listed (painting number 28 on the Salzburg list). (See Deutsch Dep. Ex. 2[Ex. 13].) He opines that this may be the “Lady with dark dress” by the famous artist Fulop Laszlo that wasowned by his family (and was framed). (Deutsch Dep. at 21-22, 25 [Ex. 22].) Clearly, there would havebeen many portraits of ladies in dresses in Europe at that time, and there is no evidence that painting number28 was actually the painting taken from Mr. Deutsch’s family.

Mr. Weiss noted three entries from the Salzburg list, (Weiss Dep. Exs. 8-11 [Ex. 22]), which heidentified by comparing it to his own list of his family’s lost paintings, (id. Exs. 2, 7 [English translation ofpart of Exhibit 2] [Exs. 17-18]). (Accord Weiss Dep. at 52, lines 6-8.) However, the descriptions on theSalzburg list do not match the descriptions on Mr. Weiss’ list because in each case, the dimensions of thepaintings are substantially different. Mr. Weiss’ list describes a 120 x 90 cm “Forest” while Salzburg listnumber 77 describes a painting of vastly different dimensions, 60 x 65 cm, described as “Forest with waterdrinking deer.” (Compare Weiss Dep. Ex. 7 with Weiss Dep. Ex. 8 [attached at Ex. 16].) Mr. Weiss’ listdescribes a 40 x 50 cm “Gobelin,” while Salzburg list number 860 describes a very differently sized, 56 x76 cm, “Gobelin Embroidery: Man and weeping woman at sunset.” (Compare Weiss Dep. Ex. 7 with WeissDep. Ex. 9 [attached at Ex. 17].) The third entry cited by Mr. Weiss, was identified at his deposition asnumber 627, but does not appear at 627 on the list attached to Professor Petropoulos’ supplemental affidavit.In any case, while the document marked by Plaintiffs as Exhibit 10 to Mr. Weiss’ deposition is difficult toread, the marked entry appears once again to have vastly different dimensions (apparently 44 x 22 cm) thanthe entry on Mr. Weiss’ list (60 x 40 cm). (Compare Weiss Dep. Ex. 7 with Weiss Dep. Ex. 10 [attached atEx. 10].)

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clear that the list of paintings at Salzburg is not a list of paintings that were on the Gold Train, and

in all likelihood, a very small percentage of these paintings were on the Gold Train (and most, if not

all, of these were from a museum). Second, neither Mr. Deutsch (who is from Budapest, Deutsch

Dep. at 11-13 [Ex. 22]), nor Mr. Weiss (who is from Szabolcsbaka, in eastern Hungary near the

Romanian border, Weiss Dep. at 7-8 [Ex. 22]), could have had their property taken from Gyor

(which is in western Hungary near Austria), from which both Professor Zweig and Plaintiffs’ expert

Gábor Kádár agree the paintings on the Gold Train came, (Zweig Report at 40 [Ex. 1A to Opening

Mem.]; Kádár Dep. at 139:6-9 [Ex. 3]). Third, all of the paintings cited by Messrs. Deutsch and

Weiss on the Salzburg list were returned to Hungary, (see Petropoulos Dep. at 132-34 [Ex. 4]),

which is what Plaintiffs contend should have happened to the Gold Train property. And fourth,

Plaintiffs’ identifications do not establish a probability that the listed paintings are the ones taken

from their families.20

21 See, e.g., id. at 40-41 (less valuable items did not make it to Gold Train); id. at 53-54 (only a“minority” of property taken by Hungarian government made it to Gold Train); id. at 87 (“there may havebeen some freights that did not make it”); id. at 89 (some property was off loaded by Hungarians to makeroom for fleeing government officials and their families); id. at 176 (United States did not acquire portionof loot that Toldi took); id. at 179-80 (“I cannot say that this necklace was on the Gold Train and thisnecklace belonged to this Hungarian Jewish owner, of course.”). Moreover, according to Mr. Kádár, themajority of property that did make it to the Army could not have been identified by individual owner (id. at168-69), making it clear that such property could never have been returned to the individual owner.Compare, e.g., Rosner I, 231 F. Supp. 2d at 1205 n.2 (Each Plaintiff must “demonstrate identifiable property”on the Gold Train.) (emphasis supplied).

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* * *

Plaintiffs next argue that even if they themselves cannot identify specific Gold Train property

that was in U.S. possession, they can demonstrate standing through the testimony of their expert

Gábor Kádár that property from several cities and regions of Hungary was loaded onto the Gold

Train. (Opp’n at 19-20). They assert that this testimony shows that they have a “colorable interest

in at least some of the property” and, under United States v. Rodriguez-Aguirre, 264 F.3d 1195 (10th

Cir. 2001), such a colorable interest is all they have to show to establish standing. Rodriguez-

Aguirre, however, involved a facial challenge to standing; thus a “facially colorable interest” was

sufficient to withstand the challenge in that case. Id. at 1203-04. Here, the government’s challenge

to Plaintiffs’ standing is factual and Plaintiffs must prove facts that demonstrate standing.

Mr. Kádár’s testimony about the origin of the Gold Train property cannot carry Plaintiffs’

burden of proof. Mr. Kádár’s deposition testimony makes clear that his list of cities and regions is

a list of cities and regions from which Gold Train property came, (see Kádár Dep. at 216 [Ex. 3]),

and he does not opine that all property taken by the Hungarian government from these places ended

up in U.S. custody.21 Indeed, it is not physically possible that all of the valuables from the parts of

Greater Hungary that Mr. Kádár identifies, (Kádár Aff. ¶¶ 33, 65 [Ex. 5 to Opening Mem.]), were

on the 24-car Gold Train even before Toldi made off with 44 or more cases of the more valuable

22 Moreover, Plaintiffs’ assertion that the “core of wealth” on the Gold Train came from Budapest,(Opp’n at 26), runs counter to, and thus undercuts, their argument that all of the property of Jews fromnumerous cities and regions of Hungary was on the train, (id. at 20).

23 Contrary to Plaintiffs’ characterization of Kádár’s testimony at pages 21-22 of their brief, Kádárdid not state that there was “very little” looting of valuable moveable property. Rather, he testified thatduring the looting of Jewish residences that occurred after the owners were forced to leave, little jewelry wastaken because it generally was safeguarded. (Kádár Dep. at 38:14-25 & 38:2 [Ex. 3].) That testimony didnot address the other instances of looting he discussed elsewhere in his deposition, (id. at 46:19-25 & 47:1).

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items.22 (See Zweig Second Report at 8 [Ex. 1B to Opening Mem.].) Of course, far fewer valuables

were on the train when the Americans took possession of it.

As set forth above and in the opening Memorandum, the numerous breaks in the chain of

custody between the time that Plaintiffs were despoiled of their property by Axis Hungarian

authorities and the time that the U.S. Army took possession of the Gold Train make it impossible

to determine whose property was on the train. See supra at 2. Plaintiffs’ charge that the government

and Professor Zweig “overstate” the impact of the disorganization associated with the collection of

the seized Jewish property, the looting, and the effect of Toldi’s convoy is without support. But

Plaintiffs’ own expert Kádár recognizes that, in practice, the Axis Hungarians’ collection of seized

Jewish property was “very chaotic” in some regions. (Kádár Dep. at 28:6-8 [Ex. 3].) Similarly,

Kádár recognizes that there was substantial looting, as well as war-related destruction, of the items

that were actually collected.23 (Id. at 46:19-25 & 47:1 [“Partly they were destroyed by the events of

war, partly they were taken by the local population, partly they were looted by the members of the

law enforcement or administrative bodies, partly they were taken by the advancing Soviet troops.”].)

Jewish valuables were also taken by Arrow Cross units and SS units that were trying to escape

Hungary. (Id. at 134:8-11.) Regarding Toldi’s loot, Plaintiffs recognize that Toldi absconded with

at least 44 cases of small, valuable pieces and implicitly acknowledge the standing problem for

Plaintiffs asserting claims for items of the type he took, e.g., diamonds, pearls, gold watches gold

24 By comparing Kádár’s description of the contents of the Gold Train at Brennbergbanya beforeToldi took off the 44 cases, (Kádár Aff. ¶ 39 [Ex. 5 to Opening Mem.]), with his description of the contentsafter Toldi took the cases, (id. ¶ 43), it is possible to determine which cases Toldi took, according to Kádár.

25 Toldi abandoned two railcars worth of “lesser value” china in Brennbergbanya in order to makeroom on the train for Axis Hungarian officials and their families who were fleeing the advancing SovietArmy. (Kádár Dep. at 89:14-19 [Ex. 3].)

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bars, gold coins, gold cigarette cases, gold necklaces, gold chains, (Kádár Aff. ¶¶ 39, 4324 [Ex. 5 to

Opening Mem.]). (Opp’n at 22 [“[F]or Plaintiffs who are claiming anything other than the kinds of

valuables that traveled in pine cases with the Toldy convoy, whatever ‘valuables’ Toldy absconded

with are irrelevant to the claim.”].) But even for Plaintiffs making claims concerning the silver,

china,25 and other types of property that Toldi did not take, the aforementioned breaks in the chain

of custody preclude standing.

Apart from the testimony of the three named Plaintiffs and an expert witness, Plaintiffs have

presented nothing to establish that property belonging to them was on the Gold Train when the U.S.

Army took over the train. And even as to those three named Plaintiffs and the expert witness, the

evidence is simply insufficient to satisfy their burden of proving that their belongings were on the

Gold Train when the United States took possession of it.

c. The United States Was under No Deadline to Decide the Property’sDisposition

The United States explained in its opening brief that even if Plaintiffs were able to prove that

their property was on the Gold Train when it came into U.S. possession, they cannot demonstrate

that if the United States had disposed of the property as they now argue it should have – restituted

all of it to Hungary – they would have regained possession of any items that belonged to them. (U.S.

Opening Mem. at 19-20.) The example of what the Hungarian government did with the Toldi loot

restituted by the French is instructive. Communist Hungary denied that the property was Jewish in

origin and very little, if any, of the property returned to its Jewish owners. (Id. at 8-9, 19.)

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Plaintiffs argue that if the United States had made a “timely restitution” of the Gold Train

property to Hungary they would have benefitted. (Opp’n at 24-25.) According to Plaintiffs, the pre-

Communist Hungarian government would have returned the property to its individual owners. (Id.)

In short, Plaintiffs contend that the United States should have restituted the property to Hungary

before the Communist government came into power. (See id.) But even before the Communists

took control of the government in Hungary, the United States had good reason to doubt that

restituting the Gold Train property would result in its return to or benefit to Hungarian Jews.

Professor Zweig explains that the United States “suspected the Russians themselves had restituted

or taken as reparations so much property from Hungary as to almost destroy the Hungarian economy

and that any property returned to Hungary would not aid the Hungarian economy but be seized

immediately by the Russians.” (Zweig Dep. at 111:2-7 [Ex. 1].)

A further problem with Plaintiffs’ argument is that the United States was under no obligation,

legal or otherwise, to dispose of the Gold Train property any earlier than it did. Plaintiffs identify

no regulation or other law that governed the timing of the United States’ decision of what to do with

the property. They argue that the United States promised Hungary that it would restitute the

property. (Opp’n at 24.) The United States disputes that any such promise was made. (See Zweig

Second Report at 19-22.) But even if under Plaintiffs’ theory there had been a promise, that theory

does not suggest a particular time by which the United States promised to give Hungary the property.

Moreover, given the destruction of evidence of individual ownership accomplished by the

pro-Nazis, it is doubtful that Hungary would have been able to determine individual owners even

if the United States had given the property to it earlier and the Hungarian government had been

inclined to return the items to individual Jewish owners. The decision that the United States made

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– to turn over the property to the IGCR – allowed for it to be used for the benefit of Jewish victims,

including Jewish victims from Hungary and the territories that Axis Hungary had annexed.

d. Plaintiffs from the Annexed Territories Would Not Have Benefitted from aRestitution to Hungary

The Opening Memorandum points out that Plaintiffs from non-Hungarian territories annexed

during the war would not have had a practical means of recovering their property if the United States

had turned it over to Hungary. (Opening Mem. at 20.) Plaintiffs do not dispute this point. Rather,

they contend that post-war border changes were irrelevant to restitution. Aside from having no

bearing on the standing problem of Plaintiffs who had lived in the annexed territories (e.g., Mr.

Irving Rosner and Mr. Francisc Basch), Plaintiffs’ contention is incorrect. Plaintiffs' own expert

points out, it was a basic principle of international law that “property should be restored to existing

governments of the territories where the property had its situs.” (Petropoulos Supp. Aff. ¶ 10(ii)

[quoting Roberts Commission] [Ex. 7 to Opening Mem.].) Because Hungary was not the existing

government of all the territories from which property on the Gold Train likely originated, U.S.

restitution policy did not permit the property to be restituted in its entirety to Hungary. Furthermore,

by making it impossible either to identify the individual owners of the property or to distinguish from

what country specific property on the Gold Train had originated, Axis Hungarian officials had

rendered the property unidentifiable as to national origin or individual ownership. Thus, the Gold

Train property was not subject to restitution under U.S. restitution policy.

e. Plaintiffs’ Burden of Establishing Standing is not Lessened by the Passage ofTime

Any difficulty Plaintiffs have establishing standing due to the passage of time does not

provide a basis for lessening their burden of proof. See, e.g., Omaha Indian Tribe v. Jackson, 854

F.2d 1089, 1093 (8th Cir. 1988) (recognizing that “because of the passage of time involved, the party

26 See also Gorelick, Marzen, Solum, Destruction of Evidence, § 2.5 at 38 (1989) (listing the fiveelements of spoliation inference as: (1) “necessity of demonstrating that an act of destruction has occurred”;(2) “requirement that the destroyed matter be evidence – that is, that it be relevant to the dispute”; (3)“requirement that the act of spoliation be intentional”; (4) “timing of the act – only the inference can bedrawn if evidence is destroyed at a time when legal proceedings are pending or reasonably foreseeable”; and(5) “limitation of the inference to destruction by parties or their agents.”).

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having the burden of proof inevitably may face insuperable barriers,” and upholding district court’s

dismissal of claims on which plaintiff did not meet its burden of proof). Any such difficulty in

Plaintiffs’ meeting their burden of proof, like the difficulties attendant to the United States’ defense

of claims that arose sixty years ago and the Court’s ability to make findings regarding such claims,

reflects the practical reasons for the statute of limitations. (See Opening Mem. at 31-33.)

f. Plaintiffs Establish No Basis for Application of Spoliation Principles

Absent evidence that the government intentionally destroyed evidence in bad faith, there is

no basis for any inference against the United States through principles of spoliation. See Bashir v.

Amtrak, 119 F.3d 929, 931 (11th Cir.1997) (“In this circuit an adverse inference is drawn from a

party’s failure to preserve evidence only when the absence of that evidence is predicated on bad faith.

Mere negligence in losing or destroying the records is not enough for an adverse inference, as it does

not sustain an inference of consciousness of a weak case.”) (quotation omitted).26 Plaintiffs present

no evidence of bad faith to support an inference that property belonging to them was on the Gold

Train.

In support of their spoliation argument, Plaintiffs assert that “the Government allowed

property and lists of property to be lost, degraded, destroyed or sold, at a time when it knew full well

that claims were being made by the Hungarian Jews.” (Opp’n at 27.) Regarding the decision to turn

Gold Train property over to the IGCR, as set forth in the Opening Memorandum and above, that

policy decision was eminently reasonable. See supra at 13-15; Opening Mem. at 1-2, 10-11. There

27 For example, there is no reason to believe that the United States would have been able to get theproperty back to its Jewish owners given the state that it was in when the Army took control of it, viz.,rendered unidentifiable as to individual ownership or national origin by officials of Axis Hungary. Evidencethat Hungary and representatives of the Hungarian Jewish community had endeavored to have the propertyreturned to Hungary is inapposite; restitution to Hungary was inappropriate because part of the propertyappeared to have come from Jews of the annexed territories that were no longer part of Hungary after thewar. And the United States had good reason to doubt that, even if restitution to Hungary were possible, sucha disposition would result in return of Gold Train property either to its individual owners or to the HungarianJewish community in general.

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is no evidence that a more just disposition of the property was possible.27 That U.S. government

officials might have recognized that allowing Gold Train property and other non-restitutable victim

assets to be used to fund refugee efforts would alleviate somewhat the financial burden on the United

States does not suggest a bad faith motive for its handling and disposition of the Gold Train property.

There is no evidence that reducing the financial burden was the primary reason behind the decision

to adopt a broad definition of Article 8’s reference to “non-monetary gold found . . . in Germany”

to include non-restitutable victim assets that were not made of gold or that were seized in Austria

rather than Germany. (See Ex. 46 to Pls.’ Opp’n [section 6 of Mem. adopted by State-War-Navy

Coordinating Committee on definition of non-monetary gold, discussing both Department of State’s

expressed interest in diminishing U.S. financial burden and fact that expanded definition of non-

monetary gold would be consistent with purpose of the Article 8 of the Paris Reparations Agreement,

viz., to aid victims of Nazi aggression].) Indeed, giving such property to the IGCR allowed it to be

used toward refugee efforts across Europe, not just in the refugee programs that the United States

was operating in its zone of occupation. Had alleviating the financial burden been the primary

objective of the United States vis-a-vis its definition of non-monetary gold, the government could

have adopted a narrow definition that confined non-monetary gold to non-restitutable victim assets

made of gold that were found in Germany. In that event, all valuable personal property of victims

that was not made of gold or was not found in Germany and that could not be restituted because

28 Similarly, that the government may have sought indemnification from the American Jewish JointDistribution Committee (“Joint”) for any claims that might be made regarding the property, (see Opp’n at28), does not suggest an ulterior motive given the above-described reasons for its turning over the propertyto the IGCR and doubt that the “old steel box papers” that the Army found were lists of the names of Jewishowners. Indeed, Plaintiffs’ evidence indicates that the United States did not receive the requestedindemnification but nevertheless gave the property to the IGCR. (See Exs. 41 & 43 to Walton Decl., citedin Opp’n at 28].)

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neither its ownership nor its national origin could be identified would have reverted to the U.S.

military government as the responsible government in the area where it was seized.28

Army Captain John Back’s reference to papers in Hungarian that were found in an “old steel

box” and appeared to him to be lists of names of the owners of some of the Gold Train property,

(quoted in Kádár Aff. ¶ 59 [Ex. 5 to Opening Mem.] & Petropoulos Supp. Aff. ¶ 57 [Ex. 7 to

Opening Mem.]), supplies no basis for the Court to presume that the lists in fact contained Plaintiffs’

names. It is doubtful that those papers actually were names of Jewish owners of Gold Train

property. Professor Zweig explains that it is “very unlikely” that the pro-Nazi Hungarian officers

would have retained evidence of the property’s Jewish ownership such as lists of the owners’ names;

they had worked hard to render the property itself unidentifiable as to individual provenance, and

they had reason to destroy evidence that the Allies might find which would show that the Gold Train

cargo had been looted from Holocaust victims. (Zweig Second Report at 16-17 [Ex. 1B to Opening

Mem.].) Indeed, Plaintiffs’ experts suggest no reason that Toldi and his men would have kept such

lists, let alone safeguarded them in a steel box.

Because the American Army personnel who found the papers did not read Hungarian, the

statement that the papers were apparently lists of names is nothing more than a mere guess. (Id.)

It is more likely that the papers were either (a) lists of names and/or other information about the 213

Hungarian government officials and family members who traveled on the train or (b) records of the

29 There is good reason to conclude that the sealed envelopes the Army found on the train containedproperty that Toldi and other Hungarian officials had set aside for themselves and bore their names, ratherthan names of Jewish owners as Plaintiffs suggest. (See Zweig Second Report at 16-17 [Ex. 1B to OpeningMem.].)

30 The regulation Plaintiffs cite in footnote 62, (Opp’n at 26), 41 C.F.R. § 128-50.101, is aDepartment of Justice regulation that concerns personal property seized by the Department of Justice; it hasnothing to do with military inventories of property seized from a wartime enemy state.

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large number of allocations of clothes and other property that Toldi had made to the train’s guards

and government officials in lieu of wages.29 (Id.)

Plaintiffs additionally charge that the government did not inventory the Gold Train property

as it was required to do, and suggest that the Court therefore should presume that had an inventory

been prepared, it would have enabled Plaintiffs’ property to be identified as belonging to them.

(Opp’n at 26.) As set forth above, the Army inventoried the property and was not required to do so

item-by-item.30 See supra at 12 n.9. Moreover, given that Toldi and his men had worked to destroy

indicia of individual ownership, it is highly doubtful that a detailed inventory would have made

individual identification possible.

In sum, Plaintiffs present no evidence that the United States acted in bad faith regarding its

inventory of the Gold Train property, its handling of “old steel box papers,” or its policy decision

to give the property to the IGCR so that it could be used to benefit Jewish and other refugees.

Accordingly, there is no basis for any inference against the United States through spoliation

principles. See Bashir, 119 F.3d at 931.

2. Plaintiffs Do Not Satisfy the Criteria for Exception to the General ProhibitionAgainst Third-Party Standing

Even if Plaintiffs could establish constitutional standing (which they cannot for the reasons

set forth above and in the Opening Memorandum), prudential considerations preclude the Court from

exercising jurisdiction because Plaintiffs cannot establish grounds for an exception to the general

31 “If both constitutional and prudential objections are raised to standing . . . a court should feel freeto deny standing on prudential grounds without first determining the constitutional question.” 13A CharlesAlan Wright, et al., Federal Practice and Procedure § 3531.15, at 102 (2d ed. Supp. 2004); accord HazardousWaste Treatment Council v. Thomas, 885 F.2d 918, 921 n.2 (D.C. Cir. 1989) (“Although [proceeding fromconstitutional to prudential requirements] is the oft-stated sequence [of standing analysis], the rule ofavoidance counsels nonetheless that, where the prudential question is clearly dispositive, we should not reachout to determine the constitutional issue”).

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prohibition against raising a third party’s legal rights, Allen v. Wright, 468 U.S. 737, 751 (1984).

Specifically, Plaintiffs demonstrate neither alignment of their interests and Hungary’s interests vis-a-

vis the Gold Train property nor any hindrance to Hungary’s ability to assert any interests it thinks

has in the property despite the 1947 Treaty of Peace and the 1973 Settlement Agreement between

Hungary and the United States.31

Contrary to Plaintiffs’ argument, (Opp’n at 28-29), because prudential standing principles

implicate a court’s exercise of jurisdiction, a rule 12(b)(1) motion is a proper vehicle for a challenge

to prudential standing. See Allen, 468 U.S. at 748 (reviewing prudential standing issue that came

before district court on motion to dismiss); American Immigration Lawyers Ass’n v. Reno, 199 F.3d

1352, 1357-58 (D.C. Cir. 2000) (explaining that D.C. Circuit “treat[s] prudential standing as akin

to jurisdiction, an issue we may raise on our own, in part because the doctrine serves the institutional

obligations of the federal courts”) (internal quotations omitted).

Plaintiffs dispute that third-party standing principles are applicable, and “deny that they are

asserting Hungary’s rights, rather than their own,” in support of their claims against the United

States. (Opp’n at 29-30.) Yet the only theories of liability Plaintiffs espouse rely on alleged

obligations of the United States to Hungary, viz., that applicable policies and laws required the

United States to restitute the Gold Train property to Hungary, (see, e.g., Supp. Petropoulos Aff. ¶¶ 5,

54, 86 [Ex. 7 to Opening Mem.]), and that the United States entered into an implied-in-fact contract

for bailment with Hungary for “return” of the property to Hungary, (Am. Compl. ¶¶ 502-09).

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Plaintiffs do not allege that they have any right against the United States vis-a-vis the Gold Train

property that is independent of alleged rights of Hungary. Because Plaintiffs’ theory of recovery

rests on alleged rights of Hungary rather than their own rights, Plaintiffs could have standing only

as third parties, which is generally prohibited. See Harris v. Evans, 20 F.3d 1118, 1121 (11th Cir.

1994). As set forth in the government’s opening memorandum and below, Plaintiffs do not meet the

second and third elements of the test for exception to the general rule against third-party standing

set forth in Powers v. Ohio, 499 U.S. 400, 410-11 (1974): alignment of interests with the third party

and hindrance of the third party’s ability to protect its interests.

That many Plaintiffs are citizens or former citizens of Hungary and that Plaintiffs assert

claims to property that they maintain is rightfully theirs cannot establish the requisite alignment of

interests. Hungary relinquished any interest in the Gold Train property through the 1947 Treaty of

Peace and 1973 Settlement Agreement, and agreed in the 1973 Settlement Agreement not to present

or support any claims to the property. See infra at 55-61 & U.S. Opening Mem. at 44-50. Hungary’s

interests vis-a-vis the Gold Train are governed by the 1947 Treaty of Peace and 1973 Settlement

Agreement and, by virtue of those agreements, are fundamentally at odds with the interests Plaintiffs

attempt to assert in support of their claims.

To be sure, the 1947 Treaty of Peace and 1973 Settlement Agreement present legal barriers

to Hungary’s asserting any claim regarding the Gold Train. However, those agreements do not

present the sort of practical barrier that, as Plaintiffs recognize, (Opp’n at 31 [citing Powers, 499

U.S. at 415]), is the requisite hindrance for third-party-standing purposes. Plaintiffs’ attempt to

recast these legal barriers as a cost-benefit hindrance is unavailing. See Amato v. Wilentz, 952 F.2d

742, 753 (3d Cir. 1991) (likelihood that third party “was skeptical about the legal merits of the suit

or had concerns about costs and risks involved” did not weigh in favor of allowing third-party

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standing, but rather indicated that litigant was not able to “adequately advocate[]” third party’s

interests). As a sovereign state, Hungary would be able to assert a claim regarding the Gold Train

property if it thought it had a claim notwithstanding the 1947 and 1973 Agreements.

C. Equitable Principles Do Not Warrant Permitting Plaintiffs’ Otherwise Time-BarredClaims to Proceed

1. Compliance with Applicable Statute of Limitations is a Condition of this Court’s Jurisdiction

As this Court already has held, Plaintiffs’ compliance with the applicable statute of

limitations, 28 U.S.C. § 2401(a), must be “strictly observed, and exceptions thereto . . not . . . lightly

implied,” as compliance is a condition of federal court jurisdiction. Rosner I, 231 F. Supp. 2d at

1206 (internal citations omitted). See Irwin v. Department of Veterans Affairs, 498 U.S. 89, 95

(1990); Compagnoni v. United States, 173 F.3d 1369, 1370 n. 3 (11th Cir. 1999); Martinez v. United

States, 33 F.3d 1295, 1316 (Fed. Cir. 2003). The Court’s ruling is consistent with the long-

established principle that statutes of limitations for suits against the United States, when established

by statute, reflect Congress’s decision to waive sovereign immunity only if suit is brought within a

particular period of time. Rosner I, 231 F. Supp. 2d at 1206; Irwin, 498 U.S. at 95; Compagnoni,

173 F.3d at 1370 n. 3; Martinez, 33 F.3d at 1316.

Plaintiffs’ arguments to the contrary are wholly without merit, and their request that the Court

reverse its earlier ruling on this point of law should be rejected. Plaintiffs argue that the Supreme

Court’s recent decisions in Kontrick v. Ryan, 124 U.S. 906 (2004), United States v. White Mountain

Apache Tribe, 537 U.S. 465 (2003), Franconia Assoc. v. United States, 536 U.S. 129 (2002),

Scarborough v. Principi, 124 S. Ct. 1856 (2002), and United States v. Cotton, 535 U.S. 625 (2000)

plainly demonstrate that, after Irwin, statutes of limitations for suits against the United States are not

jurisdictional in nature. They do not.

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First, rather than supporting Plaintiffs’ argument, the cited cases, and Irwin itself, affirm the

fundamental principle that “jurisdiction over any suit against the Government requires a clear

statement from the United States waiving sovereign immunity, together with a claim falling within

the terms of the waiver.” White Mountain, 537 U.S. at 465 (examining non-temporal condition on

jurisdiction under the Indian Tucker Act) (internal citations omitted); accord Irwin, 498 U.S. at 94

(statute of limitations examined therein is “condition to the waiver of sovereign immunity”), at 96

(“because the time limits imposed by Congress in a suit against the Government involve a waiver

of sovereign immunity, it is evident that no more favorable tolling doctrine may be employed against

the Government than is employed in suits between private litigants); Franconia Assoc., 536 U.S. at

141 (“a waiver of the sovereign immunity of the United States cannot be implied but must be

unequivocally expressed”) (internal citations omitted).

Second, contrary to Plaintiffs’ suggestion, neither Irwin, nor any subsequent Supreme Court

decision, holds that statutorily prescribed statutes of limitation for suits brought against the United

States cease to be jurisdictional simply because the rule of equitable tolling applies. Irwin stands for

the simple principle that there is a rebuttable presumption that Congress intended for courts to use

equitable tolling principles in determining the scope of the waiver of sovereign immunity. 498 U.S.

at 95-96. As the Irwin court explained, applying the rule of equitable tolling to suits against the

Government amounts to little, if any, broadening of the Congressional waiver. Id. Put another way,

application of the doctrine of equitable tolling to a statute of limitations affects the scope of

Congress’s waiver of sovereign immunity; it does not nullify its jurisdictional nature. As the

Eleventh Circuit explained in a post-Irwin decision, “Unlike general statutes of limitation which

govern independently existing causes of action between private parties, the timeliness requirement

at issue here is not procedural, or ‘remedial’, but jurisdictional.” Vintilla v. United States, 931 F.2d

32 Such a clear statement from the Federal Circuit supports this Court’s prior ruling that the time limithere is jurisdictional, even if subject to equitable tolling. Plaintiffs’ citations to non-conforming decisionsby other Circuits are not persuasive.

33 The Supreme Court’s decisions in Cotton, Scarborough, and Kontrick — and language thereinlimiting the term “jurisdictional” to Article III subject-matter jurisdiction — are also consistent. See Cotton,535 U.S. at 630-31 (defects in criminal indictment do not deprive court of subject-matter jurisdiction);Scarborough, 124 S. Ct. at 1864 (time limit on attorneys fees application not jurisdictional, because limitrelates only to post-judgment proceeding auxiliary to underlying civil action); Kontrick, 124 S. Ct. at 914(“axiomatic” that court-prescribed time limit not jurisdictional, in that it cannot “create or withdraw federaljurisdiction”) (internal citations omitted) (emphasis added).

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1444, 1446-47 & n. 1 (11th Cir. 1991) (noting inconsistency in Supreme Court precedent); accord

Bath Iron Works Corp. v. United States, 20 F.3d 1567, 1572 n. 2 (Fed. Cir. 1994) (“The language

in Irwin that the time limit may be tollable can be reconciled with the cited holdings that these

statutes of limitations are jurisdictional. Tolling is not the same as waiving. Presumably, therefore,

Irwin merely holds that those time limits, while jurisdictional, can be equitably tolled in certain

circumstances.”)32

Finally, Plaintiffs’ reliance on subsequent decisions of the Supreme Court to support its

alternative reading of Irwin is misplaced. Nothing in the Supreme Court’s discussion or analysis in

White Mountain remotely supports Plaintiffs’ bald and incorrect assertion that “the generic statute

of limitations applicable to claims brought under the Tucker Act is not jurisdictional.” Opp’n at 39.

In fact, White Mountain does not even address a statute of limitations. See generally 537 U.S. 465.

Rather, like Franconia Assoc., White Mountain simply examines the scope of Congress’s waiver of

sovereign immunity under the Tucker Act. See White Mountain, 537 U.S. at 1132 (interpreting

scope of non-temporal waiver of sovereign immunity under the Indian Tucker Act); Franconia

Assoc., 536 U.S. at 144-45 (interpreting meaning of “first accrues” in 28 U.S.C. § 2501 so as to

determine proper scope of waiver of sovereign immunity).33 Accordingly, even were this Court to

34 Having relied so heavily on the reasoning of Bodner v. Banque Paribas, 114 F. Supp. 2d 117, 135(E.D.N.Y. 2000), in their earlier papers, (see Pl. Opp’n to United States’ [First] Motion to Dismiss), Plaintiffsfail even to mention the case in their Opposition. The omission is particularly striking, given that this Courtcited Bodner as an example of a case in which extraordinary circumstances warranted equitable tolling. SeeRosner I, 231 F. Supp. at 1209. While the allegations in Plaintiffs’ complaints raise similar equitableconsiderations to those in Bodner, they are not borne out by the evidence presented.

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reconsider its earlier ruling that the applicable statute of limitations is jurisdictional, the same

conclusion should be reached.

2. Neither the Equitable Tolling Doctrine nor the Accrual Suspension RuleJustifies Plaintiffs’ Late Filing

a. Equitable Tolling

After conducting jurisdictional discovery for more than a year, Plaintiffs have failed to carry

their burden to show that principles of equity warrant this Court’s tolling of the applicable six-year

statute of limitations for more than 40 years. See Justice v. United States, 6 F.3d 1474, 1478 (11th

Cir. 1993) (plaintiff bears burden to show equitable tolling is warranted). Remarkably, Plaintiffs

have abandoned altogether their contention that they were “induced or tricked by the Government’s

misconduct into allowing the filing deadline to pass” by failing even to argue that the Court should

now apply this test. (See Opp’n at 46 [accusing government of imposing “straitjacket” on doctrine

by focusing on test in Opening Memorandum]). They have done so, notwithstanding that that is the

very ground on which this Court earlier found that the allegations of Plaintiffs’ initial Complaint

warranted tolling and permitted the case to go to discovery.34 See Rosner I, 231 F. Supp. 2d at 1209

(“[t]he allegations of the Complaint satisfy the second Supreme Court test, namely that Plaintiffs

were induced or tricked by the Government’s misconduct into allowing the filing deadline to pass”).

Rather than presenting any evidence to support the allegations underlying the Court’s prior

ruling (and then presumably arguing that the Supreme Court’s second test applies to the facts

presented), Plaintiffs state simply that “the conduct of the Government [in its handling of the Gold

35 As explained in the Opening Memorandum. at 4-14, and above, supra at 6-15, the United Statescontests most of Plaintiffs’ characterization of the government’s handling and disposition of the Gold Trainproperty, including Plaintiffs’ assertion that “the Government unilaterally redefined Article 8 to create a legalpretext to immunize itself from takings and other claims over the Hungarian Jews’ property,” (Opp’n at 48).Even assuming the truth of Plaintiffs’ allegations, however, none bears on the question of equitable tolling.

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Train] was deceptive” and ask this Court to toll the statute because “the extraordinary circumstances

of the Holocaust warrant equitable tolling.” (Opp’n at 47.) That request has no merit and should

be denied. See Sandvik v. United States, 177 F.3d 1269, 1271 (11th Cir. 1999) (whether doctrine

of equitable tolling saves cause of action otherwise barred by statute of limitations is question of

law); Justice v. United States, 6 F.3d 1474, 1478 (11th Cir. 1993) (same).

As an initial matter, Plaintiffs make the unusual suggestion that this Court should consider

the United States’ handling of the Gold Train in the post-war years as a basis on which to toll the

deadline for filing challenges thereto. Specifically, Plaintiffs argue that the United States engaged

in “deceptive conduct,” and once again recite the core allegations of their Amended Complaint: that,

in 1948, representatives of the Hungarian Jewish community asked the United States to give the

personal property it found on the Gold Train to them; that the United States informed these

representatives that the Hungarian government was the proper requestor on their behalf; that the

United States then promised Hungary that it would return all identifiable looted property to it; and

that the United States broke this promise and violated applicable restitution policy when it turned

over property found on the Gold Train to the IGCR.35 (See Opp’n at 48-49.)

Plaintiffs’ position is curious indeed. In short, they argue that the very same governmental

conduct they challenge on the merits of their claims is the reason they did not file suit for more than

40 years after the events occurred. However, Plaintiffs make no attempt to explain how these actions

caused them to delay filing suit, except to say summarily and speculatively that “[b]ut for the

Government’s possession of the property and its failure to follow governing restitution laws, the

36 Even where the government’s challenged conduct directly contributed to plaintiff’s failure to filesuit in a timely manner, equitable tolling is not necessarily warranted. See, e.g., Hopland Band of PomoIndians v. United States, 855 F.2d 1573, 1579-81 (Fed. Cir. 1988) (government’s wrongful termination ofIndian Tribe’s formal status, which led to disbanding of Tribe and its governing council, did not warranttolling statute of limitations on Tribe’s suit challenging termination).

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Hungarian Jews would have been able to obtain their property and/or pursue other remedies

adequately.” (Opp’n at 50.) Even if the named Plaintiffs had no actual knowledge of these events

until at least October 1999, they cannot now claim to have relied on the Government’s

contemporaneous representations or acts regarding the Gold Train. (See also Opening Mem. at 27

n. 23 & 31 n. 23.) Absent some proven causal link between the challenged conduct and Plaintiffs’

failure to file their claims in a timely manner, the United States’ handling of the Gold Train simply

has no bearing on the question of tolling. Raziano v. United States, 999 F.2d 1539, 1542 n. 3 (11th

Cir. 1993) (main element for equitable tolling is deception on part of the defendant “which has been,

by words or acts, communicated to the plaintiff and has misled the plaintiff”); First Alabama Bank

N.A. v. United States, 981 F.2d 1226, 1228 (11th Cir. 1993) (no equitable tolling absent “reasonable

reliance” on government acts); see also Frazer v. United States, 288 F.3d 1347, 1353-54 (Fed. Cir.

2002) (assuming that a Tucker Act claim could ever be subject to equitable tolling, it would only

be available when the lateness is attributable, at least in part, to misleading governmental action).36

Plaintiffs cite only one other instance of what they charge to be “deceptive conduct” by the

United States: the government’s classification of “documents as secret that might have revealed its

role in causing Plaintiffs’ injury.” (Opp’n at 49.) Notwithstanding the Executive Branch’s clear

authority to classify information deemed sensitive to the nation’s security and foreign affairs, see

Department of Navy v. Egan, 484 U.S. 518, 527 (1988), Plaintiffs make the incredible argument that

the very presence of information related to the Gold Train in once classified records “is sufficient

37 Plaintiffs’ assertion that “the declassification began in 1998,” (Opp’n at 49,) is patently false, asis any suggestion that the United States acted improperly in its classification and declassification of recordsrelated to the Gold Train. See supra at 3-4.

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to toll all limitations until the disabling secret classification has been lifted, at the earliest.”37 (Opp’n

at 49.) More than three years after filing suit, Plaintiffs have not produced a single piece of evidence

in support of their accusation that the United States deliberately classified documents in order to

conceal information about the Gold Train. They have not, for example, pointed to any document that

— even arguably — was classified improperly. And, again, they have failed to demonstrate how the

timing of the government’s declassification of World War II-era documents containing information

on the Gold Train is in any way related to, let alone caused, their inability to file suit until 2001.

Plaintiffs cannot point to a single document the late declassification of which led the Presidential

Advisory Commission on Holocaust-Era Assets (Presidential Commission), and thereby Plaintiffs,

to learn some previously non-public fact critical to the accrual of their claims. Nor do they cite to

any case for the proposition that the subsequent declassification of a properly classified document

permitted a claim to proceed against the United States despite the running of the applicable statute

of limitations. Accordingly, Plaintiffs have not shown that acts of classifying and declassifying

documents containing information on the Gold Train cannot satisfy Plaintiffs’ burden to show

misleading governmental conduct on which they detrimentally relied in missing the filing deadline

and, thus, has no bearing on the question of tolling. See Raziano, 999 F.2d at 1542 n. 3; First

Alabama Bank, 981 F.2d at 1228.

Lacking any evidence of governmental misconduct, or even conduct, that contributed to their

delay in filing suit, Plaintiffs nevertheless maintain that “the extraordinary circumstances of the

Holocaust” merit application of the equitable tolling to this case. (Opp’n at 47.) Equitable tolling

can be appropriate when a movant untimely files because of extraordinary circumstances that are

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both beyond his control and unavoidable even with diligence. Sandvik, 177 F.3d. at 1271; Rosner

I, 231 F. Supp. 2d at 1209. As demonstrated below, however, the equities presented here do not

warrant invocation of such an exceptional remedy. See Irwin, 498 U.S. at 96 (noting that federal

courts typically extend equitable relief “only sparingly”); Bost v. Federal Express Corp., 372 F.3d

1233, 1242 (11th Cir. 2004) (noting that equitable tolling an “extraordinary remedy”).

That many of the Plaintiffs, and their deceased family members, suffered immeasurably

during the Holocaust does not by itself constitute an extraordinary circumstance worthy of permitting

this suit to go forward. The law does not permit courts to disregard statutes of limitations established

by Congress simply out of sympathy for particular litigants. Raziano, 999 F.2d at 1542. Consistent

with this principle, courts have dismissed time-barred suits brought by survivors of the Holocaust,

even while acknowledging the tremendous extent of their suffering. See, e.g., Deutsch v. Turner

Corp., 324 F.3d 692, 716-18 (9th Cir. 2003) (affirming dismissal of action brought by Holocaust

survivor subjected to slave labor during World War II in part because barred by statute of

limitations); Iwanowa v. Ford Motor Co., 67 F. Supp. 2d 424, 432 n. 3, 461-69 (D.N.J. 1999) (same);

Sampson v. Federal Republic of Germany, 975 F. Supp. 1108, 1122-23 (N.D. Ill. 1997) (Williams,

J.) (dismissing Holocaust survivor’s claims for failure to pay reparations in part because barred by

statute of limitations), aff’d 250 F.3d 1145 (7th Cir. 2001).

As this Court has recognized, and the United States acknowledges and regrets, the majority

of the Plaintiffs in this lawsuit faced particularly difficult years immediately after World War II. See

Rosner I, 231 F. Supp. at 1209. Individual Plaintiffs told remarkable tales of courage and

determination when asked in their depositions about the rebuilding of their lives after the War. Yet,

these same individuals also told tremendous stories of success, of lives rebuilt in new countries and

new cities. (See Excerpts of Plaintiffs’ Postwar Years, App. A.) By the late 1950s, most of the

38 Plaintiffs, such as Ms. Bleir, who lived in the New York area during the late 1940s might also havelearned information about the possible disposition of their lost property as a result of the auction held by theICGR. For example, Ms. Bleir and her father attended the auction, where they retrieved their lost Kiddishcup, and having done so, reasonably could have inquired about how the origin of the auctioned property.See supra at 6. At the very least, the auction put Ms. Bleier on notice that she may have been able to traceother of her and her family’s property by investigating how the Kiddish cup arrived at the auction.

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named Plaintiffs had settled in urban areas either in Canada or in the United States, with the majority

of them relocating to either New York City or Miami. (See id.) Plaintiffs pursued diverse

occupations, raised their children and grandchildren, and generally led prosperous lives. Id. (see,

e.g., describing careers in medicine [Mr. Joseph Devenyi], chemistry [Mr. Peter Drexler], machine

design [Mr. Michael Fried], and academia [Mr. Paul Gottlieb]). Many spent some portion of the

immediate post-war years in Budapest, (see Excerpts of Post-War Years,) and many returned to

Hungary to visit over the years, some to visit family. (See Excerpts of Visits [App. B].)

All of the information Plaintiffs needed to file this lawsuit was publicly available and known

to at least some members of the Hungarian Jewish community in the 1940s. (See Opening Mem.

at 26-32; supra at 5-6.) While Plaintiffs could not necessarily be expected to have looked after their

lost property in the years immediately following the war, once settled in their new lives, the law

reasonably expects that they would do so long before October 1999.38 Bost, 372 F.3d at 1242

(equitable tolling inappropriate when plaintiff failed to act with due diligence). Accordingly, even

if it were to accept that the challenges Plaintiffs faced in rebuilding their lives after World War II

warrant tolling the statute for some period of time until the Plaintiffs could look after their legal

rights once more, that period did not extend for more than four decades. See Cada v. Baxter

Healthcare, 920 F.3d 446, 452 (7th Cir. 1990) (equitable tolling “gives the plaintiff extra time if he

needs it, [but] if he doesn’t need it there is no basis for depriving the defendant of the protection of

the statute of limitations”).

39 The cases Plaintiffs cite from other Circuits are likewise unavailing. See Cada, 920 F.3d at 452(tolling statute until younger employee replaced terminated employee, thus giving rise to claim for agediscrimination); Chung v. Department of Justice, 333 F.3d 273, 280 (D.C. Cir. 2003) (tolling may bewarranted based on criminal defendant’s fear that filing suit against the government prior to sentencingwould jeopardize request for leniency); Aleutco Corp. v. United States, 244 F.2d 674, 679-80 (3d Cir. 1957)(finding accrual of action for tortious exercise of dominion over property occurred when government shippedproperty to third-party, not at time of earlier refusal to ship to plaintiff).

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Plaintiffs have cited no precedent — controlling or otherwise — that suggests tolling a statute

of limitations for more than 40 years, absent any demonstrated misconduct or affirmative

misrepresentation by the government that caused them to miss the filing deadline, and absent any

reasonable inquiry on their part into the whereabouts of their lost property. Moreover, in the cases

Plaintiffs do cite, courts rely on equitable principles plainly inapplicable to the undisputed facts

presented here. Again, here there is no legal barrier that prevented Plaintiffs from filing suit earlier

than 2001, as was the case in Young v. United States, 535 U.S. 43 (2002) (tolling statute during

period of disability in which plaintiff agency was legally barred from pursuing its claims). Nor have

Plaintiffs shown that a government official provided affirmative misinformation about the filing

requirements for their claims, as in Ferreiro v. United States, No. 96-4963 (11th Cir. Sept. 30, 1997)

(Ex. 46 to Walton Decl., Opp’n) (tolling statute because plaintiff detrimentally relied on incorrect

information about legal claim provided by government counsel). Neither have they demonstrated

that they acted with due diligence in preserving their legal rights, as did the plaintiffs in Burnett v.

New York Cent. R.R., 380 U.S. 424, 434-435 (1965) (tolling statute when plaintiff brought timely

action in state court and served the defendant with process, but state action later dismissed for

improper venue), and Furnes v. Reeves, 362 F.3d 702, 723-24 (11th Cir. 2004) (tolling statute when

plaintiff made “extensive efforts” to locate child who had been abducted by defendant until child was

found, thereby also confirming necessity of legal action in United States).39

40 The United States does not waive any argument that 28 U.S.C. § 2401 is not subject to equitabletolling as a matter of law.

41 Plaintiffs assert that the “taking” that is the subject of their Fifth Amendment claim, (Am. Compl.at 166 n. 6), the breach that is the subject of their bailment claim, (Am. Compl. at 168), the wrongful act atthe core of their illegal exaction claim, (Am. Comp. at 170), and the policy decision at the heart of theirinternational law claims is the physical transfer of Gold Train property to the IGCR in November 1947.Plaintiffs also challenge the Army’s handling of the property while in its custody prior to that transfer. (Am.Compl. at 83-104.) As such, all events necessary to their causes of action had occurred by at latest 1949.

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Accordingly, on the facts presented, equitable considerations no longer justify tolling the

statute of limitations to permit Plaintiffs’ late-filed complaint.40

b) Suspension of Accrual Date

For the first time, Plaintiffs now argue in the alternative that the accrual date for their claims

against the United States should be suspended until October 1999, when the Presidential

Commission issued its Progress Report. (Opp’n at 42-43.) In making this argument, Plaintiffs do

not dispute that all of the events on which their claims are based occurred by 1950 — more than 50

years before they filed this lawsuit in May 2001.41 Nor do they dispute that the critical facts needed

to make their claims — that, at the end of World War II, the United States took possession of a train

that had come from Hungary loaded in part with the personal property of Jews and did not return the

found Jewish property to the Hungarian government, or to them — were disseminated publicly in

the 1940s. (See Opening Mem. at 25-32.) Rather, they argue that their claims against the United

States could not have accrued until October 1999, because: (1) none of the 24 putative class

representatives had actual knowledge of these facts until the late 1990s, and (2) the atrocities

suffered by many of the named Plaintiffs during the war, and the difficulties they faced in the years

immediately following, were such that they could not reasonably be expected “to have made any

inquiry — let alone sufficient inquiry” into the whereabouts of their lost property at any time in the

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ensuing 40-plus years. (Opp’n at 44) (emphasis added). As is demonstrated below, neither reason

is an appropriate ground on which to suspend the accrual of a claim.

In order to benefit from the “accrual suspension” rule, Plaintiffs must show either

that (1) the United States concealed its acts with the result that Plaintiffs were unaware of their

existence, or (2) that their injury was “inherently unknowable” at the accrual date. Martinez v.

United States, 333 F.3d 1295, 1319 (Fed. Cir. 2003) (explaining application of rule to Tucker Act

claim barred by limitations period in 28 U.S.C. § 2501); Japanese War Notes Claimants Assoc. v.

United States, 373 F.2d 356, 359 (Ct. Cl. 1967) (explaining that “an example of the latter would be

when defendant delivers the wrong type of fruit tree to plaintiff and the wrong cannot be determined

until the tree bears fruit”); see also Urie v. Thompson, 337 U.S. 163, 169 (1949). As discussed

above, Plaintiffs have failed to point to any act of concealment by the United States, let alone one

that caused Plaintiffs’ ignorance of the basic facts underlying their claims, supra at 3-5, and is belied

by the United States’ public dissemination of the news of its finding and handling of the Gold Train.

And, two undisputed facts — that the international media reported on United States involvement

with the Gold Train in the 1940s and that some members of the Hungarian Jewish community had

actual knowledge of the challenged actions as they unfolded — render untenable any possible

suggestion that the events of the Gold Train ever have been “inherently unknowable.” (See Opening

Mem. at 25-32.) As a result, the named Plaintiffs’ lack of actual knowledge of the basic facts

underlying their cause of action is not a permissible reason to suspend accrual of their claims. See

Japanese War Notes, 373 F.2d at 359 ( “[i]gnorance of rights that should be known is not enough”

to suspend accrual of statute of limitations).

Plaintiffs’ second basis for requesting suspension of the accrual date is similarly deficient,

for the reasons discussed in the equitable tolling section above. Supra at 37-44. Again, they argue

42 Contrary to Plaintiffs’ characterization of Morrison v. United States, 492 F.2d 1219, 1225 & n.8(Ct. Cl. 1974), (Opp’n at 52 n.96), that case specifically recognizes that the Army Field Manual is notbinding upon courts and serves only to “provide authoritative guidance to military personnel.”

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that it is unreasonable to expect them to have made any inquiry whatsoever, at any time, into the

possible whereabouts of their lost property. Notwithstanding that the law is much less forgiving of

those who fail to exercise due diligence in preserving their legal rights, Irwin, 498 U.S. at 458; Bost,

372 F.3d at 1242, Plaintiffs ask to be exempted from this obligation altogether because of the

challenges they faced in rebuilding their lives immediately after the War. But, a simple inquiry into

the fate of looted Hungarian Jewish property during the War, including a review of newspapers from

the immediate post-war years at a public library, would have produced articles about the Gold Train

and the information sufficient to assert their claims. It is not unreasonable to expect them to have

made such reasonable efforts once settled in their new lives.

As the Supreme Court has explained, “[s]tatutes of limitations are primarily designed to

assure fairness to defendants. Such statutes promote justice by preventing surprises through the

revival of claims that have been allowed to slumber until evidence has been lost, memories have

faded, and witnesses have disappeared.” Burnett, 380 U.S. at 428 (internal citations omitted). Here,

on the facts presented, the equitable considerations at play do not warrant permitting Plaintiffs’

otherwise time-barred suit to go forward against the United States, whose fair defense is made

particularly difficult given the significant passage of time.

D. The APA Does Not Permit Review for the Claims Plaintiffs Assert under It

Plaintiffs do not dispute the lack of Congressional intent for the customary and conventional

international law, the Provisional Handbook for Military Government in Austria, and other military

handbooks or manuals on which they rely to bind the United States and serve as a basis for review

by Article III courts.42 Absent an indication that Congress intended for a particular standard to

43 The government does not argue that a separate cause of action beyond the APA is required for aclaim under the APA, as Plaintiffs assert, (Opp’n at 56 n.102). Rather, an indication that Congress intendedfor the United States to be legally bound by the standard at issue is necessary. (See Opening Mem. at 37-38.)

44 Plaintiffs do not dispute that the APA supports only claims for non-monetary relief. To the extentPlaintiffs’ claims purport to seek monetary relief based on the APA (each cause of action in the FirstAmended Complaint seeks money damages), they must be dismissed.

45 See also Mem. from Property Control Officer Homer Heller to Chief, Property Control Branch of10/21/45 (“Because of the magnitude of the task a detailed inventory has not been taken, however, a generalinventory and history was prepared . . .”) (copy attached as Ex. 8).

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govern conduct of the United States, that standard may not form the basis for review under the

APA.43 (See Opening Mem. at 37-38 [citing cases].) For the reasons set forth in the government’s

Opening Memorandum, then, Plaintiffs’ APA claims should be dismissed insofar as they rely on

standards set by international law and Army handbooks or manuals.44 (See id. at 37-40.)

Regarding Plaintiffs’ APA claims generally, there can be little doubt that the Army’s

decisions about how many resources to devote to security at the Salzburg warehouse, how many

resources to devote to inventorying the property, and the State-War-Navy Coordinating Committee’s

policy decision to turn over the property to the IGCR – the actions which Plaintiffs challenge under

the APA – are the sort of discretionary decisions that courts should not second-guess. (See Opening

Mem. at 42-43.) Plaintiffs do not suggest that there exist any meaningful standards against which

the Court might judge: the Army’s allocation of limited personnel resources between warehouse

security and the other pressing responsibilities it had as occupation authority,45 (see Expert Report

of Jeffrey J. Clarke at 8 [Ex. 3A to Opening Mem.]); the detail with which the Army inventoried the

property it found on the Gold Train given its limited resources; or the United States’ policy decision

regarding disposal of victim assets that were unidentifiable as to national origin and individual

ownership but were not covered by the Paris Reparations Agreement because they were found in

Austria rather than Germany. Given the lack of any such meaningful standards, Plaintiffs’ APA

46 As noted in the government’s Opening Memorandum, to the extent that the Court’s analysis inRosner I can be read as contrary to this argument, the United States respectfully requests that the Courtreconsider that analysis.

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claims should be dismissed as “committed to agency discretion by law,” 5 U.S.C. § 701(a)(2).

(See Opening Mem. at 41-43.)

With regard to the exception for World War II functions included in the APA as originally

enacted, Plaintiffs misconstrue the exception’s application to the claims they have asserted under the

APA. That exception evidences Congress’ intention that courts not review actions that the military

took in its capacity as post-World War II occupation authority. The exception covered “functions

which by law expire on the termination of present hostilities, within any fixed period thereafter, or

before July 1, 1947 . . .” APA, § 2(a)(4), 60 Stat. 237 (1946). Functions that by law expired at the

official end of the war, or within “any fixed period thereafter,” plainly included functions that the

government performed as occupation authority following the war. Plaintiffs do not dispute that the

Army acted with regard to the Gold Train property in its capacity as occupation authority, a function

that by law was tied to the aftermath of World War II and terminated at the end of the period fixed

by the post-war treaty between the Allies and Austria, see Austrian State Treaty, May 15, 1955, art.

20 §§ 1-3, 6 U.S.T. 2369 (1955) (providing for occupation to end on July 27, 1955).

Similarly, good reason exists for the Court to base its determination of whether the APA’s

military-authority exception applies on examination of the source of authority for the actions which

Plaintiffs challenge.46 The plain language of 5 U.S.C. § 701(b)(1)(G) provides that it covers

“military authority” that is exercised in the field either during war or in occupied territory. Military

authority was undoubtedly the source of power for the Army’s decisions regarding inventory of the

Gold Train property, security of the property, and requisitioning of property at the warehouse where

the property was stored. As explained in the government’s Opening Memorandum, military

47 Even the Provisional Handbook for Military Government inAustria (April 1945) ("ProvisionalHandbook"), on which the Plaintiff's Opposition relies so heavily, makes it clear that the occupationgovernment in Austria was military in character. (See, e.g., Provisional Handbook at 7-8 [Ex. 6].)

48 Macleod v. United States, 229 U.S. 416 (1913) (cited in Opp’n at 53 n.100), was decided beforethe APA was enacted.

49 Were it otherwise, the military authority exception would be without effect because a plaintiffcould always avoid its application by styling his/her claim as pertaining to the government’s failure to revisitactions taken during wartime or in occupied territory once war had ended or the government was no longeran occupation authority.

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authority is the basis on which the United States acts in U.S.-occupied territory.47 (Opening Mem.

at 35-36 [citing Madsen v. Kinsella, 343 U.S. 341, 357 (1952), and Army Field Manual 27-10 ¶ 284

(Rules of Land Warfare)].) Because the United States acted in its capacity as occupation authority

when it gave the Gold Train property – property which it had found in its occupied territory – to the

IGCR, its act of giving the property to the IGCR likewise was based on military authority.

Plaintiffs’ argument that this interpretation is too broad and would result in a blank check on

military action exception, (Opp’n at 55-56), is without merit. As the cases Plaintiffs cite

demonstrate, there are military actions not taken pursuant to occupation authority that are subject to

judicial review. (See cases cited in Opp’n at 51-55.48)

Lastly, Plaintiffs attempt to recast their APA claims as challenging, at least in part, alleged

failure by the United States to take action following the war. (Opp’n at 56.) But a failure to take

action cannot logically constitute a “final agency action” under 5 U.S.C. § 704, at least absent

evidence that the government had reason to act.49 See, e.g., Cobell v. Norton, 240 F.3d 1081, 1095

(D.C. Cir. 2001). The “failure to act” on which Plaintiffs base their argument is the lack of a U.S.

accounting of Gold Train property still in the government’s possession. (Opp’n at 56.) Yet they

present no evidence, or reason to believe, that any Gold Train property remains in the government’s

50 The 1956 Army decision to transfer art that may have been on the Gold Train to Austria does notsuggest that any Gold Train property is still in the government’s possession. To the contrary, it indicates thatif the government encountered such property it disposed of it in accordance with applicable law. The transferof the art to Austria was consistent with the Austrian State Treaty, under which the United States turned overthe responsibilities it had as governing authority in U.S.-occupied Austria to the Austrian government in1955. See Austrian State Treaty, art. 20 §§ 1-2. Disposing of property found in Austria was certainly aresponsibility of the governing authority in Austria. By 1956, the Austrian government was that authority.

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possession.50 Plaintiffs’ own expert does not believe that it would be possible to arrive at a precise

accounting of what was on the Gold Train when the United States took possession of it.

(Petropoulos Dep. at 177:5-18 & 178:10-16 [Ex. 4].) Under these circumstances, even if Plaintiffs

presented a final agency action for the Court to review, requiring the government to incur the

substantial expense that the resource-intensive search Plaintiffs describe would not be warranted.

E. The Little Tucker Act Does Not Provide A Waiver of Sovereign Immunity forPlaintiffs’ Claims Based on International Law or Army Manuals or Handbooks

This Court correctly concluded that the Little Tucker Act does not provide jurisdiction for

international law claims because such claims are not “‘founded either upon the Constitution, or any

Act of Congress, or any regulation of an executive department, or upon any express or implied

contract.’” Rosner I, 231 F. Supp. 2d at 1210-11 (quoting 28 U.S.C. § 1346(a)(2)); accord Phaidin

v. United States, 28 Fed. Cl. 231, 234 (1993). This finding is clearly correct. See, e.g., Sosa v.

Alvarez-Machain, 124 S. Ct. 2739, 2762-62, 2765 n.19 (2004). As such, they do not fall under the

Little Tucker Act.

Similarly, neither the Provisional Handbook nor the Army Field Manual constitutes a source

of binding law for which the Tucker Act waives sovereign immunity. As explained in the Opening

Memorandum, neither document constitutes an executive regulation. (See Opening Mem. at 39-41;

see also infra at 69-70.) Even if they did, they are by no means money-mandating. White Mountain,

51 The United States does not dispute that the Little Tucker Act provides a waiver of sovereignimmunity for Fifth Amendment takings and illegal exaction claims and its implied-in-fact contract claim.As discussed below, this Court should dismiss Plaintiffs’ Fifth Amendment illegal exaction claim, which isbased on an alleged violation of the Fifth Amendment due process clause, on the same grounds it earlierdismissed their Fifth Amendment takings claim. Infra at 68-69.

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527 U.S. at 472 (statute creating a Tucker Act right must be reasonably amenable to the reading that

it mandates a right of recovery in damages”).51

II. The First Amended Complaint Fails To State a Claim upon which Relief May Be Granted

A. Rule 12(g) Does Not Protect Plaintiffs from Judicial Review of the First AmendedComplaint

While chastising the United States for making what they characterize as “technical”

arguments, (Opp’n at 2), Plaintiffs attempt to interpose the most technical of all procedural hurdles,

one that would have no substantive effect and would merely waste resources of the parties and the

Court and unnecessarily prolong this litigation. While conceding that the United States has not

waived any defenses, Plaintiffs contend that Federal Rule of Civil Procedure 12(g) nevertheless

prevents the Court from ruling on “any defense . . . that was available to [the United States]” when

it filed its first Motion to Dismiss. (Id. at 58.) Plaintiffs do not specify which defenses they claim

fall into this category, nor do they explain why the Court should require a separate motion on issues

that are fully briefed and dispositive of this litigation and that both parties agree have not been

waived. In any event, Rule 12(g) does not bar the Court’s consideration of the issues raised in the

United States’ motion.

First, Rule 12(g) generally does not apply to motions to dismiss for failure to state a claim

pursuant to Rule 12(b)(6). Federal Rule 12(g) prohibits a Rule 12 motion on grounds that were

available but omitted in a prior Rule 12 motion “except a motion as provided in subdivision (h)(2)

hereof on any of the grounds there stated.” Rule 12(h)(2) includes among defenses that may be

subsequently raised, “[a] defense of failure to state a claim upon which relief can be granted.”

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Reading Rules 12(g) and 12(h)(2) together, “a party who makes a motion under Rule 12 is precluded

from raising a similar objection omitted in the first motion unless the motion is based upon a ground

set forth in Federal Rule of Civil Procedure 12(h)(2). Rule 12(h)(2) includes a motion to dismiss

for failure to state a claim.” Schiessle v. Stephens, 525 F. Supp. 763, 766 (N.D. Ill. 1981).

Plaintiffs concede (twice) that Rule 12(h)(2) preserves the United States’ arguments that their

Amended Complaint fails to state a claim. (Opp’n at 58 n.105; id. at 59 n.106.) Nevertheless,

Plaintiffs would have the parties re-brief certain unspecified issues, presumably in a motion for

judgment on the pleadings, and force the Court to deal with yet another motion, when all of the

relevant legal issues have been briefed and both parties are eager to move this litigation forward as

rapidly as a full and fair resolution of the issues permits. Such an absurd result is not compelled by

the Federal Rules. See Fed. R. Civ. P. 1 (The Rules of Civil Procedure “shall be construed and

administered to secure a just, speedy, and inexpensive determination of every action.”). Plaintiffs’

proposed interpretation of Rule 12(g) would disserve justice, speed, and efficiency.

Additionally, the filing of an Amended Complaint generally will obviate any application of

Rule 12(g) even to arguments (unlike those at issue here) that might otherwise be waived by Rules

12(g) and 12(h)(2). Particularly here, where the Amended Complaint “greatly expands the factual

allegations the Plaintiff has made against the Defendant,” “the Defendant is entitled to a ‘fresh start’

in answering Plaintiff’s amended complaint.” Brown v. E.F. Hutton & Co., 610 F. Supp. 76, 78

(S.D. Fla. 1985) (allowing motion to arbitrate in response to amended complaint although motion

was not made as to earlier complaint); see also Mount v. LaSalle Bank Lake View, 926 F. Supp. 759,

763 (N.D. Ill. 1996) (allowing new defenses in motion to dismiss Fourth Amended Complaint even

though that complaint was “amended for ‘housekeeping’ measures” because an “Amended

Complaint represents Plaintiffs’ [additional] opportunity to properly plead their case [and thus] [t]he

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court finds that Defendants deserve similar accommodation in their opportunities to defend against

that case”).

At 172 pages and 543 paragraphs, Plaintiffs’ Amended Complaint is well over four times

longer than their original complaint, and it adds two new causes of action and 24 new Plaintiffs.

Moreover, the Amended Complaint substantially changes Plaintiffs’ legal theories. For example,

while the original complaint was based on a theory that “[t]he items on the train were in locked

containers with the names and addresses of the owners on the outside,” Rosner I, 231 F. Supp. 2d

at 1205, and thus property could and should have been returned to these owners, see Compl. ¶¶ 110,

113, 114, their new theory posits that even though the property was not labeled at the time the Army

acquired it, the United States was obligated “to return the property to Hungary,” First Am. Compl.

¶ 504; see also Second Affidavit of Jonathan Petropoulos, ¶¶ 44, 48. The latter theory obviously

implicates the foreign relations between the United States and Hungary in a way that the former did

not, thus leading to the United States’ invocation of international agreements between the two

nations. Additionally, the Amended Complaint alters the nature of both the alleged bailment

contract (now based on an alleged agreement between the United States and Hungary rather than the

United States and Plaintiffs) and the alleged international law violations (now based on relations

between the United States and Hungary) prompting new grounds for the dismissal of those counts.

Finally, Plaintiffs have added causes of action alleging illegal exaction and violation of military

regulations counts prompting new arguments from the United States.

As this Court has stated: “‘Since the amended pleader chooses to redo his original work, and

receives the benefit of this nunc pro tunc treatment, he can hardly be heard to complain that claims

filed against him are improper because they should have been asserted in response to his original

pleading.’” Brown, 610 F. Supp. at 78 (quoting Joseph Bancroft & Sons Co. v. M. Lowenstein &

52 Plaintiffs’ contention is particularly inequitable because Plaintiffs themselves seek to re-litigateissues such as whether a non-resident alien with no voluntary connection to the United States may assert aTakings claim and whether an international law claim against the United States for money damages may bemaintained. (See, e.g., Opp’n at 69-71 (Takings); id. at 33-37 & n.70 (international law).)

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Sons, Inc., 50 F.R.D. 415, 419 (D. Del. 1970).52 This Court should consider all the issues presented

in the United States’ Motion.

B. Plaintiffs’ Claims Are Barred by International Agreements

Plaintiffs’ discussion of the relevant international agreements contains little case law and

other authoritative citations and, in any event, contains no rebuttal of the applicable precedent (see

Opening Br. at 44-50) that demonstrates that Plaintiffs’ claims are barred by the 1947 Treaty of

Peace with Hungary (“Treaty of Peace”) as well as by the 1973 Settlement Agreement between the

United States and Hungary.

The standards for construing a treaty are clear and undisputed. “We must be governed by the

text–solemnly adopted by the governments of many separate nations.” Chan v. Korean Air Lines,

Ltd., 490 U.S. 122, 134 (1989); accord United States v. Alvarez-Machain, 504 U.S. 655, 663 (1992)

(“In construing a treaty, as in construing a statute, we look first to its terms to determine its

meaning.”). “If the language of the treaty is clear and unambiguous, as with any exercise in statutory

construction, our analysis ends there and we apply the words of the treaty as written.” United States

v. Duarte-Acero, 208 F.3d 1282, 1285 (11th Cir. 2000) (citing Chan, 490 U.S. at 135). Drafting

history may be consulted only where the text is ambiguous and, even then, the treaty’s “most natural

meaning could properly be contradicted only by clear drafting history.” Chan, 490 U.S. at 134-35

& n.5. Plaintiffs do not dispute that when interpreting a treaty, courts give substantial deference to

the Executive Branch’s interpretation. See El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng, 525 U.S.

155, 168 (1999); United States v. Lombera-Camorlinga, 206 F.3d 882, 887 (9th Cir. 2000) (en banc)

(deference due to executive branch interpretation of treaty exists where position is taken in litigation

53 As noted in the United States Opening Memorandum at 49 n.36, the State Department correctlytook the position that the Treaty of Peace barred claims for handling of the Gold Train property nearly fourdecades ago.

54 See also id. Arts. 29.1, 29.2 (granting the United States and other allied powers “the right to seize,retain, liquidate or take any other action with respect to all property, rights and interests which at the cominginto force of the present Treaty are within its territory and belong to Hungary or to Hungarian nationals, andto apply such property or the proceeds thereof to such purposes as it may desire, within the limits of itsclaims and those of its nationals against Hungary or Hungarian nationals,” and providing that “[t]heliquidation and disposition of Hungarian property shall be carried out in accordance with the law of theAllied or Associated Power concerned [and] [t]he Hungarian owner shall have no rights with respect to suchproperty except those which may be given him by that law”).

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in which government is a party);53 cf. Kwan v. United States, 272 F.2d 1360, 1362 (Fed. Cir. 2001)

(“When the foundation document is an agreement between governments, non-governmental entities

can not ordinarily challenge either their interpretation or their implementation.”).

1. The Treaty of Peace Bars Plaintiffs’ Claims

The Treaty of Peace unambiguously waives “all claims of any description” against the United

States and its allies that (1) belong to “the Hungarian Government or Hungarian nationals,” and (2)

arise “out of actions taken because of the existence of a state of war in Europe after September 1,

1939.” Treaty of Peace Art. 32.1.54 This waiver includes (but is not limited to) claims based on

“acts of forces or authorities” of the United States. Id. The claims Plaintiffs assert in this litigation

fall within this clear waiver.

First, the claims belong to Hungary (Plaintiffs contend that the United States had a legal duty

to return property to the Hungarian government) and (with regard to the majority of Plaintiffs) the

claims are being asserted by persons who were Hungarian nationals at the time the Treaty of Peace

went into effect. Second, the claims arise directly out of actions taken because of a state of war in

Europe after September 1, 1939. As Plaintiffs do not deny, the Army seized the Gold Train only

because of the state of war in Europe. (Opp’n at 63.) Indeed, the Army would not have been in

55 It is ironic that Plaintiffs seek to bring claims based on alleged breach of “the law of war” in thehandling of the Gold Train property (see Pl. Opp’n at 38) but with regard to the Treaty of Peace, suggest thatthe Gold Train has nothing to do with the war.

56 In S.N.T. Fratelli, the court applied identical language from the Treaty of Peace with Italy, whichlike the Treaty of Peace with Hungary was imposed on the defeated Axis power by the victorious allies.Compare Treaty of Peace with Italy, Art.76.1 with Treaty of Peace with Hungary, Art. 32.1 (identicallanguage except that “Italy” and “Italian” replace “Hungary” and “Hungarian”). The court found that thewaiver barred an Italian corporation’s claim based on alleged requisitioning in Eritrea because the “treatywaives without geographical restriction, all claims sustained as a consequence of acts of United States orBritish forces or authorities.” 166 Ct. Cl. at 479 (emphasis in original).

Plaintiffs’ contention that this court should ignore case law interpreting other treaties with similaror identical language is without merit. (See Opp’n at 66 n.115.) Where, as in these treaties, the languageis clear, the negotiating history is not relevant, see supra, and thus identical language should be interpretedidentically. Additionally, with regard to the World War II peace treaties with defeated Axis powers, the“one-sided waiver of claims” (Opp’n at 63) is based on the same “negotiating” history, i.e. victory over theAxis powers, and the treaties with Hungary, Italy, Romania, and Bulgaria were even signed on the same day.

57 See also Hijo v. United States, 194 U.S. 315, 323-24 (1904) (treaty ending Spanish-American warbarred claim based on seizure of non-belligerent merchant ship after cessation of hostilities).

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Austria at all but for the state of war.55 For that matter, the Gold Train would not have been in

Austria, fleeing the advancing Soviet army, but for the war in Europe. And certainly, the United

States would not have had motive or ability to use property for the benefit of displaced persons as

Plaintiffs allege the United States did, were it not for the state of war in Europe that led to the large

number of refugees.

Plaintiffs contend that the alleged United States actions at issue “did not occur ‘in Hungarian

territory’ or as an ‘exercise of purported belligerent rights.’” (Opp’n at 63.) But the broad waiver

in the Treaty of Peace does not require that the acts take place in Hungary, see S.N.T. Fratelli

Gondrand v. United States, 166 Ct. Cl. 473, 479 (1964)56; Pauly v. United States, 152 Ct. Cl. 838

(1961) (Treaty of Peace with Hungary barred claim for seizure of civilian horses in Germany), nor

that they comprise the exercise of purported belligerent rights, see Neri v. United States, 204 F.2d

867 (2d Cir. 1953) (treaty barred claim based on voluntary towing of vessel after combat had

ceased).57 Rather, as the Treaty text makes clear, claims for acts in Hungary and claims arising out

58 E.g., Exec. Order 8785, § 5E (June 14, 1941); Herrera v. United States, 222 U.S. 558, 569 (1912);United States v. Pac. R.R. Co., 120 U.S. 227, 233 (1887); The Rapid, 12 U.S. (8 Cranch) 155, 161 (1814).

59 The Allies’ desire to create a state of repose in which the battles of the time period would not bere-fought in civil suits is demonstrated by Article 30.4 of the Treaty of Peace in which “Hungary waives onits own behalf and on behalf Hungarian nationals all claims against Germany and German nationalsoutstanding on May 8, 1945, [including] all claims for loss or damage arising during the war.” (Emphasissupplied). Obviously, the extinguishment of Hungarian claims against Germany was based neither onmilitary victory nor relative moral fault, but on a desire to eliminate litigation (other than criminal litigationfor war crimes) over the acts of militaries.

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of the exercise of belligerent rights are only two subcategories on a non-exhaustive list of claims that

fall within the broad category of “all claims of any description” that are extinguished by the Treaty.

Plaintiffs cannot deny that their claims fall into another subcategory on that list, as the claims are

based on “acts of forces or authorities” of the United States; the securing and handling of the Gold

Train property was done by United States forces and the decision to provide the property to the IGCR

for the benefit of refugees was made by United States authorities.

Because the treaty text is clear, Plaintiffs’ non-textual arguments, (Opp’n at 63-66), are

inapposite. See Duarte-Acero, 208 F.3d at 1285. Even if they were relevant, however, they would

not support Plaintiffs’ position. Plaintiffs suggest that the phrase “Hungarian nationals” should be

read to exclude Hungarian Jews because the “Jews of Hungary were not enemies of the Allied

Powers.” (Opp’n at 63.) This anti-textual reading is wrong for numerous reasons. For one, an

individual’s personal views or even actions during a war do not affect his or her status under laws

relating to war; nationality is what is relevant.58 Additionally, the purpose of a claims waiver

provision is not, as Plaintiffs imply, to punish the defeated nation. Rather, it is to protect the Allies,

“to free the United States from any claim resulting from the war and/or occupation,” Neri v. United

States, 102 F. Supp. 718, 720 (S.D.N.Y. 1951), and to create a state of repose.59 And third, Plaintiffs

no longer contend that the United States’ fault was failure to return the Gold Train property to

individual owners. They now contend that the United States breached an alleged duty to return the

60 As the State Department concluded in 1965: “Hungary waived all claims for the restitution ofproperty by the United States in the peace treaty. If any obligation exists, either moral or legal, it rests uponthe forces or authorities who took the property from Hungary.” (Opening Mem. Ex. 11.)

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property to Hungary. As such, they are asserting claims that are derivative of Hungary’s alleged right

to receive the property, and Hungary’s rights were extinguished.

Plaintiffs next contend that applying the plain meaning of Article 32.1 would render Article

27 of the treaty a “cruel nullity.” (Opp’n at 64.) This is incorrect. Article 27 provides:

Hungary undertakes that in all cases where the property, legal rights or interests inHungary of persons under Hungarian jurisdiction have, since September 1, 1939,been the subject of measures of sequestration, confiscation or control on account ofthe racial origin or religion of such persons, the said property, legal rights andinterests shall be restored together with their accessories or, if restoration isimpossible, that fair compensation shall be made therefor.

Treaty of Peace Art. 27.1. Contrary to Plaintiffs’ suggestion, Article 27 is complimentary with the

claims waiver provision of Article 32. Article 27 required Hungary to make restitution to all of those

who, like Plaintiffs, had property stolen during the war because they are Jewish. As the Treaty

extinguishes claims against the Allies in Article 32, it provides, in Article 27, a legal right to

compensation for all Hungarian Jews (and Jews from occupied areas) by Hungary, the perpetrator

of the despoliation.60 Notably, Hungary’s obligation to make “fair compensation” for property stolen

exists even if Hungary cannot restore the actual property. Thus, victims of the pro-Nazi Hungarian

regime should have been made whole for the thefts by the thief (or, more accurately, its successor).

Plaintiffs claim that Article 20 of the Treaty of Peace supports their contention. In fact, the

language they quote is (1) from Article 30, (2) taken out of context, and (3) irrelevant. The clause

actually states that “[i]dentifiable property of Hungary and of Hungarian nationals removed by force

or duress from Hungarian territory to Germany by German forces or authorities after January 20,

1945, shall be eligible for restitution.” Treaty of Peace Art. 30.2. The Gold Train and its contents

are not covered by this provision as they were removed by Hungarian, not German, forces to Austria,

61 Moreover, the next provision of the Treaty states that “[t]he restoration and restitution ofHungarian property in Germany shall be effected in accordance with measures which will be determined bythe Powers in occupation of Germany,” Treaty of Peace Art. 30.3, demonstrating that even in the case ofproperty taken by Germany, it was the occupying Allies who were given the authority to determine whichproperty to restitute.

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not Germany, where they were surrendered to the Army (and the Hungarian forces had rendered the

property’s ownership unidentifiable).61

Finally, Plaintiffs’ contention that “neither U.S. nor Hungarian officials at the time the treaty

was in the process of adoption thought that it controlled the pending restitution discussions or

claims,” Pl. Br. at 64-66, is similarly irrelevant. The United States is not contending that Article 32

of the Treaty of Peace prevented the United States from providing the Gold Train property to

Hungary or determined what property was eligible for restitution. Rather, Article 32 protects the

United States from civil liability to the extent it made any errors in the process of handling the Gold

Train property or making decisions about it. Civil liability for such handling and decisions is

“extinguished” by the Treaty. Treaty of Peace Art. 32.2.

2. The 1973 Settlement Agreement Bars Plaintiffs’ Claims

While the Treaty of Peace barred initial liability for the claims Plaintiffs now assert, even if

such liability had existed, it would have been extinguished by settlement by the 1973 Agreement

between the Government of the United States of America and the Government of the Hungarian

People’s Republic Regarding the Settlement of Claims, 24 U.S.T. 522. (See Opening Mem. at 49-

50.) Despite Plaintiffs’ strained reading of the 1973 Agreement, the text of that Agreement makes

clear that Hungary settled all claims for “Hungarian property lost as a result of World War II.” 1973

Agreement, at Art. 6. It is clear that the Gold Train property was property lost as a result of World

War II. See supra. Moreover, for purposes of the 1973 Agreement, Plaintiffs’ nationalities are not

relevant. Because the Plaintiffs are asserting that the United States should have returned the Gold

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Train property to Hungary, they are asserting Hungary’s claims which, if they ever existed, were

explicitly settled by the 1973 Agreement.

C. This Court Properly Dismissed Plaintiffs’ Takings Claim with Prejudice

Plaintiffs have raised their Takings cause of action for the third time. This Court correctly

dismissed this claim with prejudice more than two years ago, see Rosner I, 231 F. Supp. 2d at 1212-

13 (holding that Plaintiffs’ Takings claim was legally deficient), and then denied Plaintiffs’ motion

for reconsideration, see Rosner v. United States, No. 01-1859-CIV, 2002 WL 3195442, at *1-*3

(S.D. Fla. Nov. 25, 2002) (“Rosner II”) (addressing Plaintiffs’ reconsideration motion which

“reargue[d] many of the points dismissed” in the Court’s earlier opinion and finding that Plaintiffs

could not assert a Takings claim and that “discovery related to this claim would be pointless”).

Plaintiffs nevertheless believe that they can reassert this claim again. (See Opp’n at 69-71.) “This,

of course, flies in the face of the plain words of the order, which dismisses [the claim] with

prejudice.” Blickenstaff v. R.R. Donnelley & Sons Co. Short Term Disability Plan, __ F.3d __, 2004

WL 1770467, at *11 (7th Cir. Aug. 9, 2004) (emphasis in original). Plaintiffs’ position that they

may continually reassert a claim that has been dismissed with prejudice conflates “dismissal with

prejudice” and “dismissal without prejudice” and threatens re-litigation of the same issues.

The arguments raised by Plaintiffs here are as meritless as their predecessors. The “new”

facts Plaintiffs allege have no bearing on the validity of their claims. The fact that the United States

undertook to protect persecuted Jews in Europe (hardly a new fact) “does not indicate Plaintiffs’

voluntary association with the United States.” Rosner II, 2002 WL 3195442, at *2. The fact that

the United States allegedly asserted in 1947 that it would not return the property that it allegedly

“took” does not change the date of the alleged taking any more than Plaintiffs’ rejected argument that

their claims accrued in 1999. Id. at *3. And the presence of Plaintiffs Edith Amster, Jonas Stern,

62 Contrary to Plaintiffs’ assertion on page 70 n.119 of their brief, Mr. Stern did not testify that hewas the legal heir to the property lost by his relatives, nor could he as his mother is still alive.

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and David Mermelstein (the latter whose connections with the United States at the relevant time

were found to be inadequate in Rosner I, see 231 F. Supp. 2d at 1214) does not save the claim.

Neither Mrs. Amster nor Mr. Stern can identify any property that was on the Gold Train, (see Amster

Dep. at 18-19 [attached at Ex. 22]; Stern Dep. at 84 [attached at Ex. 22]), and Mr. Stern is not even

the heir to the property taken from his grandparents and great-uncle by the Hungarian Nazis, (see

Opening Mem. at 50 n.37).62 Mr. Mermelstein came to the United States in 1947, (see Mermelstein

Dep. at 18 [attached at Ex. 22]), after the United States took possession of the Gold Train.

Additionally, the legal landscape relevant to Plaintiffs’ Takings claim has not changed. “It

is well established that certain constitutional protections available to persons inside the United States

are unavailable to aliens outside our geographic borders.” Zadvydas v. Davis, 533 U.S. 678, 693

(2001). Accordingly, “[t]he Supreme Court has long held that non-resident aliens who have

insufficient contacts with the United States are not entitled to Fifth Amendment protections.” Jifry

v. FAA, 370 F.3d 1174, 1182 (D.C. Cir. 2004). Accord Rosner I, 231 F. Supp. 2d at 1212-14 (citing

cases); Cuban Am. Bar Ass’n, Inc. v. Christopher, 43 F.2d 1412, 1428-29 (11th Cir. 1995) (aliens

outside the U.S. have “no First Amendment or Fifth Amendment rights which they can assert”).

Plaintiffs now contend that fifty years of settled case law has been impliedly overruled by the

Supreme Court’s recent opinion in Rasul v. Bush, 124 S. Ct. 2686 (2004). This contention is flatly

wrong. Rasul interpreted a statute, which is not at issue here, and expressly did not overrule the

holding in Johnson v. Eisentrager, 339 U.S. 763, 783-85 (1950), that constitutional rights, including

Fifth Amendment rights, do not obtain for aliens who do not have a substantial voluntary connection

with the United States.

63 Accord id. at 2694 (Eisentrager “devoted . . . little attention to question[s] of statutoryjurisdiction”); id. at 2694 n.8 (the Eisentrager Court “clearly understood the Court of Appeals’ decision torest on constitutional and not statutory grounds”).

64 Of course, district and circuit courts cannot engage in anticipatory overruling of Supreme Courtprecedents, see, e.g., State Oil Co. v. Khan, 522 U.S. 3, 20 (1997), and the constitutional holdings ofEisentrager, Zadvydas, and United States v. Verdugo-Urquidez, 494 U.S. 259 (1990) remain good law.

65 Plaintiffs’ quotation of Rasul addresses the point that non-resident aliens are not categoricallybarred from bringing suit in U.S. courts (see Opp’n at 70-71), a point that has never been disputed in this caseand which has no bearing on what substantive legal rights non-resident aliens possess. Indeed, the texthighlighted by Plaintiffs, see id., states no new law; it is from Disconto Gessellschaft v. Umbreit, 208 U.S.570 (1908), a case nearly a century old which received a “cf” cite in Rasul.

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The Court in Rasul repeatedly emphasized that its decision that aliens held at the U.S. Naval

Base at Guantanamo Bay had a right to seek habeas corpus review was based on an interpretation

of the habeas statute, 28 U.S.C. § 2241, and not on a reading of the Constitution. The question

framed by the Court was “whether the habeas statute confers a right to judicial review” for aliens

detained in Guantanamo Bay. 124 S. Ct. at 2693 (emphasis supplied). The Court held “that § 2241

confers on the District Court jurisdiction to hear petitioners’ habeas corpus challenges to the legality

of their detention at the Guantanamo Bay Naval Base.” Id. at 2698. The Court distinguished

Johnson v. Eisentrager on the grounds that Eisentrager dealt with the “question of the prisoners’

constitutional entitlement to habeas corpus” and “had far less to say on the question of petitioners’

statutory entitlement to habeas review.” Id. at 2693-94 (emphases in original).63

Accordingly, the Rasul Court made no effort to revisit Johnson v. Eisentrager’s specific

rejection of extraterritorial application of the Fifth Amendment, see Eisentrager, 339 U.S. at 785,

much less overrule numerous subsequent cases such as those cited above and in Rosner I.64 Rasul

casts no doubt on the established rule that non-citizens who do not have a substantial voluntary

connection to the United States may not assert rights under the Constitution.65

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Plaintiffs’ Takings Claim was properly dismissed. “To hold otherwise would be to invite

constitutional claims against the United States government from all over the world, and hence, start

a path down a very slippery slope.” Rosner I, 231 F. Supp. 2d at 1213.

D. The Claim for Breach of Implied-In-Fact Contract Cannot Succeed

The government recognizes that, as Plaintiffs emphasize, the Court stated in its ruling on the

motion to dismiss the original complaint that a decision on Plaintiffs’ contract claim was better left

for summary judgment. Rosner, 231 F. Supp.2d at 1215. However, the First Amended Complaint’s

elucidation of Plaintiffs’ theory of contract liability reveals that the claim cannot succeed, regardless

of any further factual development.

It defies common sense that representatives of the pro-Nazi Axis Hungarian government

would have entered into a contract to benefit the Jews from whom that same government stole the

property in the first place, as the First Amended Complaint asserts, (Am. Compl. ¶¶ 502-09).

Likewise implausible is Plaintiffs’ assertion that the U.S. Army officers who seized the Gold Train

would have had authority to make and would have made contractual promises on behalf of the

United States with representatives of an enemy government who were stranded in U.S. occupied

territory. Allowing Plaintiffs’ claim to proceed would result only in wasted resources, the Court’s

and the parties’. The claim should be dismissed now.

E. Plaintiffs’ International Law Count Fails To State a Claim

1. Rasul v. Bush Has No Bearing on Plaintiffs’ International Law Cause ofAction

Plaintiffs’ discussion of Rasul v. Bush, (Opp’n at 33-34), is both incorrect and irrelevant.

As noted above, supra at 62-63, Rasul v. Bush interpreted a specific statute, 28 U.S.C. § 2241, and

found that it provided habeas corpus jurisdiction in that case. That statute is not relevant here.

Instead, as is established, this Court does not have jurisdiction over Plaintiffs’ international law

66 Additionally, only an alien may bring a claim under the jurisdictional provisions of 28 U.S.C. §1350, Kadic v. Karadzic, 70 F.3d 232, 238 (2d Cir. 1995), and thus – even if the ATS constituted a waiverof the United States’ sovereign immunity, which it does not – the claims of the majority of Plaintiffs whowere U.S. citizens at the time this suit was filed would still be deficient. Ungaro-Benages v. Dresdner BankAG, __ F.3d __, 2004 WL 1725591, at *3 n.7 (11th Cir. Aug. 3, 2004).

67 This construction of the ATS as providing jurisdiction over claims against individuals only isconsistent with Congress's decision, when enacting the Torture Victim Protection Act of 1991, Pub. L. 102-256, 106 Stat. 73 (Mar. 12, 1992) (codified as a note to 28 U.S.C. § 1350) , to make the international lawnorm against torture enforceable only against individuals while specifically precluding suits againstgovernments. See S. Rep. No. 102-249, at 7 (1991) (TVPA “uses the term ‘individual’ to make crystal clearthat foreign states of their entities cannot be sued under this bill under any circumstances: only individualsmay be sued.”); H.R. Rep. No. 102-367, at 4 (1991) (“Only ‘individuals,’ not foreign states, can be suedunder the bill.”).

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claims because there is no waiver of the United States’ sovereign immunity for these types of claims.

See Rosner I, 231 F. Supp. 2d at 1210 (Alien Tort Statute does not waive sovereign immunity); id.

at 1210-11 (Tucker Act does not waive sovereign immunity for international law claims); Opening

Mem. at 38-39 (APA does not waive sovereign immunity for Plaintiffs’ international law claim).

2. Sosa v. Alvarez-Machain Confirms that Plaintiffs’ International Law CountFails To State a Claim upon which Relief May Be Granted

The Supreme Court's decision in Sosa v. Alvarez-Machain, 124 S. Ct. 2739 (2004), upon

which plaintiffs now rely, in fact provides further support for the conclusion that plaintiffs' claims

must be dismissed. Plaintiffs invoke that part of the Sosa opinion that construed the Alien Tort

Statute, 28 U.S.C. § 1350. That part of the opinion, however, is irrelevant here because, as the

Supreme Court has held, and this court has recognized, the ATS does not overcome the sovereign

immunity that generally bars claims against the United States or foreign governments.66 See

Argentine Republic v. Amerada Hess, 488 U.S. 428 (1989) (ATS does not abrogate foreign states’

sovereign immunity); Rosner I, 231 F. Supp. 2d at 1210. (ATS does not waive United States’

sovereign immunity).67 Nor does Sosa's discussion of what international law violations are

cognizable under the ATS's specific grant of jurisdiction have broader implications for the law

enforceable under more general grants of jurisdiction that make no reference to customary

68 Plaintiffs’ Opposition does not dispute the clearly established point that the Hague Conventiondoes not provide a private right of action. (See Opening Mem. at 53.)

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international law. See Sosa, 124 S. Ct. at 2765 n.19 (clarifying that the decision is limited to courts'

jurisdiction under the ATS and emphasizing that its holding "does not . . . imply that every grant of

jurisdiction . . . carries with it an opportunity to develop common law"). Moreover, to the extent

plaintiffs seek, in order to benefit from Sosa's ATS holding, to characterize their claims as “torts,”

it is Sosa's other holding, construing the Federal Tort Claims Act, that is most relevant and, indeed,

fatal to those claims. The exclusive avenue for bringing a tort claim against the United States is the

FTCA. 28 U.S.C. § 2679; Bieregu v. Ashcroft, 259 F. Supp. 2d 342, 352 (D.N.J. 2003). As the first

half of the Sosa opinion makes perfectly clear, the FTCA does not waive the United States' immunity

with respect to torts that accrued outside the United States. Sosa, 124 S. Ct. at 2754; see also 28

U.S.C. § 2680(k). Thus, far from supporting jurisdiction over plaintiffs' tort claims for violation of

international law, Sosa affirmatively forecloses those claims.

As described, Sosa reinforces the Eleventh Circuit’s holding that an individual may not assert

claims based on customary international law against the United States for conduct that occurred

outside the United States.68 (See Opening Mem. at 53-54 (quoting Haitian Refugee Ctr. v. Baker,

953 F.2d 1498, 1511 (11th Cir. 1992)).) This is particularly important here where Plaintiffs

challenge decisions regarding the deployment of military resources and relations between the United

States and Hungary. As the Sosa court stated, “the potential implications for the foreign relations

of the United States of recognizing such causes [of action for violation of international law] should

make courts particularly wary of impinging on the discretion of the Legislative and Executive

Branches in managing foreign affairs.” Id. at 2763.

69 Plaintiffs’ international law claim fails for the separate and additional reason that their AmendedComplaint does not identify a sufficiently definite and universally accepted obligatory norm of customaryinternational law that allegedly has been violated. See Sosa, 124 S. Ct. at 2765; Villeda Aldana v. Fresh DelMonte Produce, Inc., 305 F. Supp. 2d 1285, 1292 (S.D. Fla. 2003).

The cases cited by Plaintiffs do not establish such a rule of customary international law. BancoNacional de Cuba v. Chase Manhattan Bank, 658 F.2d 875 (2d Cir. 1981), dealt with the far different areaof expropriation by a government of real property within its borders. The court discussed the concepts(unrelated to this case) of “Permanent Sovereignty over Natural Resources” and “the right to nationalization[as] an expression of the full permanent sovereignty of the State,” and determined that internationaldocuments “present[ ] at best a confused and confusing picture as to what the consensus may be as to theresponsibilities of an expropriating nation to pay ‘appropriate compensation,’ and just what that term maymean.” Id. at 890-91; see also Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398, 428 (1964) (“There arefew issues in international law today on which opinion seems to be so divided as the limitations on a state’spower to expropriate the property of aliens.”). In West v. MultiBanco Comermex, S.A., 807 F.2d 820, 831-32 (9th Cir. 1987), the court found that government action taking dollar denominated accounts and replacingthem with pesos at an artificially imposed exchange rate did not violate international law. In KalamazooSpice Extraction Co. v. Provisional Military Gov’t of Socialist Ethiopia, 729 F.2d 422, 426 (6th Cir. 1984),the plaintiff sued based on a treaty (i.e., not customary international law) requiring compensation forexpropriation. Shanghai Power Co. v. United States, 4 Cl. Ct. 237 (1983), is a Fifth Amendment TakingsClause (i.e., not customary international law) case in which the court found that the United States’ settlementof the plaintiff’s claim against a foreign country did not violate the Takings Clause. Bolchos v. Darrel, 3 F.Cas. 810 (D.S.C. 1795), was based on a treaty, not customary international law, and Republica v. DeLongchamps, 1 U.S. 111, 116 (1784) was a criminal case (resulting in a fine and imprisonment) based onan attack on a diplomat.

Finally, Plaintiffs’ citation to the United States’ Brief in the Portrait of Wally case, (see Opp’n at 37),does not support their position for numerous reasons. First, the United States’ Wally brief states a ruleagainst the seizure of property by combatants from civilians during wartime. The Gold Train was taken frommembers of the Axis Hungarian army, an enemy of the United States, i.e., a combatant, thus, making this ruleentirely inapplicable. Second, this rule is derived from “treat[ies] and other unambiguous agreement[s]” notfrom customary international law. Sosa makes clear that treaties, such as the Hague Conventions, that arenot “self-executing” cannot support a customary international law cause of action. 124 S. Ct. at 2767. Third,the rule stated in the Wally brief does not provide a substantive cause of action but rather preventsapplication of the act of state doctrine, a doctrine that is inapplicable here (see Opening Mem. at 54 n.42).

70 Plaintiffs cannot assert an illegal exaction claim based on the Fifth Amendment’s Takings Clause.“Takings and illegal exaction claims are conceptually distinct. Takings claims arise because of a deprivationof property that is authorized by law. . . . Illegal exactions arise when the government requires payment in

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Plaintiffs’ claim for breach of customary international law should be dismissed.69

F. Plaintiffs’ Illegal Exaction Count Fails To State a Claim

Plaintiffs’ illegal exaction claim is “that the Government retained their property in violation

of the law based on the Constitution (due process and takings), Decree No. 3 and other policies and

law in effect in occupied Austria.”70 (Opp’n at 33.)

violation of the Constitution, a statute, or a regulation.” Orient Overseas Container Line (UK) Ltd. v. UnitedStates, 48 Fed Cl. 284 (2000) (citing Dureiko v. United States, 209 F.3d 1345, 1359 (Fed.Cir. 2000)(takings); Eastport S.S. Corp. v. United States, 372 F.2d 1002, 1007-1008 (Fed Cir. 1967) (illegal exaction).

71 Plaintiffs also misconstrue the brief filed by the United States in the Portrait of Wally matter,(Opp’n Ex. 17],) which does not state that Decree No. 3 governs restitution of property to the country oforigin. Rather, the government’s brief states the general rule that “under [unspecified] military policies anddecrees in effect in post-war Austria,” property, including the particular painting that is the subject of thelawsuit and which was identifiable both as to owner and national origin, was returned to the country oforigin.” (See Portrait of Wally Memorandum, 9 [Opp’n Ex. 17]). While the government’s brief does notidentify the applicable military decrees and policies it references, it does not rely on Decree No. 3 for thisstatement. Nor could it, as Decree No. 3 does not address restitution policy.

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Plaintiffs’ claim for illegal exaction due to a violation of the Fifth Amendment’s Due Process

Clause, even if otherwise viable, must be dismissed for the same reasons this Court dismissed

Plaintiffs’ Fifth Amendment Takings Clause claim: Plaintiffs lack the substantial connections to the

United States necessary to assert Constitutional claims against the United States for its seizure and

disposition of the Gold Train property. Rosner I, 231 F. Supp. at 1212-14 (dismissing Fifth

Amendment Takings Claim with prejudice). For the reasons stated above, supra at 60, Plaintiffs’

arguments in support of their request that the Court reconsider its dismissal of their Takings Clause

claim plainly are equally unavailing to save their illegal exaction claim based on the Fifth

Amendment’s Due Process Claim.

Plaintiffs’ claim for illegal exaction based on an alleged violation of Decree No. 3 is also

baseless. First, as is evident on the face of the Decree, it primarily concerns seizure of property,

which is not the conduct Plaintiffs challenge in this lawsuit. (See Decree No. 3 [Opp’n, Ex. 18].)

(“All property within the occupied territory of Austria . . . is hereby declared subject to seizure or

possession of title . . or otherwise being taken into control by Military Government.”) It does not

address restitution policy, which Plaintiffs are challenging with their illegal exaction claim.71

Second, Decree No. 3 — which is simply an announcement to the civilian population of Austria of

the U.S. Forces Austria’s policies — is neither an executive regulation necessary to invoke this

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Court’s jurisdiction under the Little Tucker Act, nor can it “fairly be interpreted as mandating

compensation” for the damage sustained. White Mountain, 537 U.S. at 472.

G. Plaintiffs’ Count for Violation of Executive Regulations or Military Rules Fails ToState a Claim

As discussed in the United States’ Motion at 58-59, Plaintiffs’ cause of action for alleged

violation of executive regulations or military rules fails to state a claim for two independent reasons.

First, the manuals cited by Plaintiffs do not have the force of law and cannot support a cause of

action. And second, even military regulations that have the force of law do not support a cause of

action by third parties, i.e. persons other than the military personnel whose employment rights and

duties are governed by the regulations. Plaintiffs’ Opposition provides no refutation of either of

these bases for dismissal.

As to the first point, the manuals themselves state that they are guides and not binding law.

(See Opening Mem. at 39-40, 58.) Such guides do not support a cause of action. See id. (citing

Chrysler Corp. v. Brown, 441 U.S. 281, 301-02 (1979) and Schweiker v. Hansen, 450 U.S. 785, 789

(1981)). In response to this point, Plaintiffs cite only Morrison v. United States, 492 F.2d 1219,

1225 & n.8 (Ct. Cl. 1974), for the supposed proposition that the Army Field Manual “contains

substantive law.” (Opp’n at 52 n.96.) However, the very footnote of Morrison cited by Plaintiffs

states that “those provisions of the [Field] Manual which are neither statutes nor the text of treaties

to which the United States is a party should not be considered binding upon courts and tribunals

applying the law of war.” Morrison, 492 F.2d at 1225 n.8 (quoting Army Field Manual 27-10 (July

1956)) (emphasis supplied); see also id. at 1225 (“The purpose of the manual is to provide

authoritative guidance to military personnel.”). Thus, Morrison, like the authority cited by the

72 Paragraphs 323, 326, 331, and 345 of the Army Field Manual paraphrase provisions of the FourthHague Convention and its Annex. (See Ex. 7.) It is settled law that the Hague Convention does not providea private right of action. (See Opening Mem. at 53.) Moreover, these paragraphs discuss the seizure ofproperty from private citizens under U.S. occupation, not the seizure of property from an enemy belligerentsuch as the Axis Hungarian military, making them inapposite to this case.

73 Plaintiffs do not challenge the United States’ assertion that the Provisional Handbook does notcreate binding law. (See Opening Mem. at 39, 58.) This handbook includes Decree Number 3 cited byPlaintiffs. (See Ex. 6.) Like the rest of the Provisional Handbook, Decree Number 3 provides only guidanceand direction to military personnel in the performance of their duties. (Id.)

74 See Feliciano v. Laird, 426 F.2d 424 (2d Cir. 1970) (enlisted man sought habeas corpus ormandamus to get hardship discharge from army); Van Bourg v. Nitze, 388 F.2d 557 (D.C. Cir. 1967)(discharged naval officer sought declaratory judgment action to change nature of discharge); Bluth v. Laird,435 F.2d 1065 (4th Cir. 1970) (army officer sought mandamus to get temporary deferment); Nixon v.Secretary of the Navy, 422 F.2d 934 (2d Cir. 1970) (Navy enlisted man denied declaratory judgment andmandamus to cancel enlistment extension agreement); Schatten v. United States, 419 F.2d 187 (6th Cir.1969) (marine sought habeas corpus relief claiming that marines’ retention of him violated statute); Smithv. Resor, 406 F.2d 141 (2d Cir. 1969) (military reservist sought writ of habeas corpus to prevent his call toactive duty and appellate court recommended treating case as mandamus proceeding).

Even in military employment cases, “judicial review is only appropriate where the Secretary’sdiscretion is limited and Congress has established tests and standards against which the court can measurehis conduct,” Murphy v. United States, 993 F.2d 871, 873 (Fed. Cir. 1993), and a court may only review thedecision-making procedures and not the merits of the actual decision, Adkins, 68 F.3d at 1323 (“[A]lthoughthe merits of a decision committed wholly to the discretion of the military are not subject to judicial review,a challenge to the particular procedure followed in rendering a military decision may present a judicialcontroversy.”) (emphases in original). If the decision-making procedure is found to violate a statute orproperly promulgated regulation, the issue is remanded to the military and the military is required to makethe decision again following the proper procedure. Id. at 1327.

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United States, clearly shows that the Army Field Manual is a guide for military personnel and does

not itself create binding law.72 As such, the Field Manual cannot support a private cause of action.73

As to the second point, the United States’ Motion demonstrates that third parties cannot sue

based on alleged violations of military regulations even where those regulations constitute binding

law. See Opening Mem. at 58-59 (citing Dreyfus v. Von Finck, 534 F.2d 24, 28-29 (2d Cir. 1976),

Tiffany v. United States, 931 F.2d 271, 280-81 (4th Cir. 1991), and Gammill v. United States, 727

F.2d 950, 953 n.4 (10th Cir. 1984)). The six Vietnam War era cases cited by Plaintiffs are not to the

contrary. (Opp’n at 51.) Each of these cases involves a suit by a military service member for writ

of habeas corpus or mandamus, or for declaratory judgment regarding his service.74 None of these

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cases supports a private right of action for damages or injunctive relief by a third party. Plaintiffs’

fifth cause of action should be dismissed.

CONCLUSION

For the foregoing reasons, and those in the Opening Memorandum, the First Amended

Complaint should be dismissed pursuant to Fed. R. Civ. P. 12(b)(1) for lack of subject matter

jurisdiction and pursuant to Fed. R. Civ. P. 12(b)(6) for failure to state a claim upon which relief can

be granted.

Respectfully submitted,

PETER D. KEISLER Assistant Attorney GeneralMARCOS D. JIMENEZ The United States Attorney for the Southern District of FloridaWENDY A JACOBUS Assistant U.S. Attorney Assigned No. A5500028VINCENT M. GARVEY Deputy Branch Director

______________________________Of Counsel: CAROLINE LEWIS WOLVERTONKEVIN ROBITAILLE, Major Assigned No. A5500447TIMOTHY RYAN, Captain CAROLYN A. MCKEEU.S. Army Litigation Office Assigned No. A5500760

JEFFREY M. SMITHAssigned No. A5500805U.S. Department of JusticeCivil DivisionP.O. Box 883Washington, D.C. 20044Telephone: (202) 514-3336Facsimile: (202) 616-8470

DATED: August 31, 2004 Attorneys for the United States

CERTIFICATE OF SERVICE

I hereby certify that on September 1, 2004, true and correct copies of DEFENDANT’SREPLY MEMORANDUM IN SUPPORT OF ITS MOTION TO DISMISS PLAINTIFFS’FIRST AMENDED COMPLAINT were transmitted electronically and mailed, first class,postage prepaid, to:

Samuel J. DubbinDUBBIN & KRAVETZCommerce Bank Center220 Alhambra Circle, Suite 400Coral Gables, FL [email protected]

Attorney for Plaintiffs

______________________________

Documents

DEFENDANT’S REPLY MEMORANDUM IN SUPPORT OF ITS …1. Rasul v. Bush Has No Bearing on Plaintiffs’ International Law Cause of Action ..... 63 2. Sosa v. Alvarez-Machain Confirms